Ex-CJ Corona, kin sued for tax evasion

Posted at 08/30/12 9:43 AM

Corona revoked waiver opening his bank accounts

MANILA, Philippines (UPDATE 3) – The Bureau of Internal Revenue filed Thursday tax evasion charges worth P150.68 million against former chief justice Renato C. Corona, his daughter, Ma. Carla Beatriz C. Castillo, and son in law, Constantino T. Castillo III.

The BIR said the charges against Corona total 12 tax violations including violation of Section 254 (attempting to evade or defeat taxes) and 255 (failing to file an income tax return) of the National Internal Revenue Code from 2003 to 2005, 2007, 2008 and 2010.

In a press briefing, BIR Commissioner Kim Henares said Corona did not declare all his assets in his SALNs. In his SALNs, Corona’s networth ranged between P7 million to P22 million from 2002 to 2010 when he was still a member of the Supreme Court.

BIR investigation, however, showed Corona did not declare two real properties he acquired during his stint in government: a condominium unit at the Columns, along Ayala Avenue that he bought for P3.6 million in 2004 and a property in Fort Bonifacio that he bought for P9.16 million in 2005.

Henares said BIR also discovered a substantial disparity between the acquisition cost of the properties declared in his SALNs with that in the certificates authorizing registrations.

The BIR chief said Corona revoked an unconditional bank waiver he submitted before the Senate impeachment trial last May. The waiver allows all banking institutions to open up his accounts to scrutiny by government agencies.

She said she only found out that Corona had revoked the waiver when a local bank refused to give a certification on Corona’s bank accounts due to the revocation of the waiver.

"I think I can disclose this because it is the subject of a declaratory relief case in a regional trial court in Makati. When we were asking for the certification from Banco de Oro, their legal wrote us and said the lawyer of Chief Justice Corona said that Chief Justice Corona is revoking the waiver," she said.

"So we were questioning that because the waiver was executed by the chief justice and therefore the only one who can revoke it is the chief justice. That is our argument with Banco de Oro but BDO brought us to court on a declaratory relief, asking whether they can give us the declaration. Based on my last information, CJ Corona was asked to comment and I believe, based on the comment, he confirmed that he is revoking the waiver,” she added.

Henares said the BIR has already received bank certifications on Corona’s peso and dollar accounts that were covered in the impeachment trial.

She dismissed speculation that the tax evasion case is politically motivated. She said the Coronas have failed to explain their assets after receiving a letter of authority from her office.

“The BIR is not a political office. We are a law enforcement office. Our mandate is to ensure that all citizens follow the national internal revenue code. All those who violate the code, we either call their attention or we sue them,” she said.

The BIR computed Corona’s deficiency income tax liability at P120.5 million for the nine-year period. The BIR computed his tax liability using the expenditure method which is based on the theory that if a taxpayer’s expenditure in a given year exceeds his reported income, the excess spending represents unreported income.

Corona, a registered taxpayer of Revenue District Office No. 32 that covers Sampaloc, Sta Mesa and San Miguel, served as former President Gloria Macapagal Arroyo’s Chief of Staff, Presidential Spokesman and acting executive secretary before she appointed him as associate justice in the Supreme Court and as chief justice.

He was removed from office last May after the Senate impeachment court found him guilty of failing to truthfully disclose all his assets in his SALNs. Corona earlier admitted before the court that he had $2.4 million in dollar deposits and P80 million in peso deposits.

Daughter, son-in-law also charged

Corona’s daughter is being charged for violating section 254 of the National Internal Revenue Code or attempting to evade or defeat taxes in 2010 and violating section 255 or failing to file an income tax return for the same year.

Mr. Castillo is being charged for violating section 254 of the National Internal Revenue Code or attempting to evade taxes in 2003 and 2009 and violating section 255 of the NIRC or failing to file a return in 2003.

According to the BIR, Mr. Castillo registered with the BIR in 1998 but filed his income tax returns only from 2005 to 2009. Mr. Castillo declared a total income of only P1.933 million for the five-year period.

His wife, on the other hand, only filed income tax returns for only 2008 and 2009 where she declared a total income of only P228,040.

While the Castillo couple’s declared income amounted to less than P3 million, they were able to acquire three properties: a P10.5-million property in Project 3, Quezon City, a P15-million commercial property in Kalayaan Avenue, Quezon City and an P18-million mansion in La Vista, Quezon City.

Using the expenditure method, the BIR computed the deficiency income tax liability of Mr. Castillo at P20.25 million. The deficiency income tax liability of Corona’s daughter, meanwhile, amounts to P9.93 million.