Tax evasion raps filed vs Malampaya project contractor

Posted at 11/28/2013 1:07 PM

MANILA, Philippines - The Bureau of Internal Revenue (BIR) has filed a criminal complaint with the Department of Justice against the owner of a trading and construction company that was contracted for several infrastructure projects funded by the Malampaya fund in 2008.

The complaint against Bella C. Tiotangco involved her willful attempt to evade taxes and failure to supply correct information in her income tax return and VAT returns in 2008.

Tiotangco is the sole proprietress of BCT Trading and Construction, with address at Sitio Digiboy, Guadalupe, Coron, Palawan.

BCT is engaged in construction and retail sale of hardware, paints and glass. In 2008, the company was engaged by the Provincial Government of Palawan to construct several infrastructure projects funded by Malampaya Funds.

Based on the BIR investigation, Tiotangco declared only P167.77 million in gross revenues in 2008. She claimed in her ITR that she received P8.58 million from the Department of Transportation and Communication (DOTC), P9.59 million from the Department of Public Works and Highways (DPWH) – Palawan Third Engineering District and P17.73 million from the Philippine Ports Authority (PPA).

However, documents gathered by the BIR showed she received P330.36 million in income payments from the Provincial Government of Palawan in 2008.

She also received P52.95 million as income payment in 2008, as based on the certification issued by PPA for completing the “Construction of Back-up Area and Roro Ramp, Port of El Nido, Palawan” project.

The BIR noted Tiotangco's gross revenues should have been P401.48 million in 2008, which meant she underdeclared her income by P233.71 million or by 139%. She also underdeclared her VAT declaration for the 2nd, 3rd and 4th Quarters of 2008 by P71.55 million (224%), P123.66 million (318%) and P123.11 million (246%), respectively.

The BIR assessed Tiotangco an aggregate deficiency tax liability for taxable year 2008 in the amount of P277.21 million, including surcharges and interests.