BIR Kim Henares versus Manny Pacquiao and the People of the Philippines. Obviously, Kim Henares got knocked down by just first round in DOJ ring fight.
The Bureau of Internal Revenue (BIR) is set to look into the bank accounts of dead people to reach their target collection goal of ₱50 billion by 2016.
BIR Commissioner Kim Henares said they will take advantage of a loophole in the Bank Secrecy Law to check taxable inheritance and boost estate tax collections from about P1 billion a year to an average of ₱12.5 billion.
An estate tax is a tax on the right of any given deceased person to transmit wealth to heirs. It is imposed on a given heir's inherited estate or assets if the value of the estate exceeds an exclusion limit set by law.
Republic Act 1405 or the Philippine Law on the Secrecy of Bank Deposits meanwhile states that accounts cannot be disclosed by banks and may not be examined except upon written permission of the depositor or if the money involved is the subject of litigation. Henares explained that bank accounts owned by the deceased are not protected by the law on bank secrecy because obviously, they have passed away. Heirs of the deceased can claim to enjoy bank secrecy either because technically, they don't own the assets of their deceased relative yet.
"The BIR wants everyone to become rich, so that we can collect more taxes. If you die, and you're rich, you pay more estate tax," Henares said.
Finance Secretary Cesar Purisma meanwhile said the low, static level of current estate tax collections contradicts rising property and stock prices.
Purisima also urged inheritors to amend their estate tax declaration and payments before they are caught. The government is set to investigate estate tax payments over the last five years he said.
BIR Kim Henares versus Manny Pacquiao and the People of the Philippines
Obviously, Kim Henares got knock down by just first round in DOJ ring fight.
DOJ junks tax case vs Pacquiao
The Department of Justice (DOJ) has junked the case filed by the Bureau of Internal Revenue (BIR) against boxing champion and Sarangani Rep. Manny Pacquiao.
In an eight-page resolution, the DOJ called it absurd to hold Pacquiao liable for neglecting to obey a BIR subpoena which he did not receive at all.
The DOJ agreed with the respondent that there was no valid service of the subpoena duces tecum upon him.
The Justice Department said the allegation of BIR Officer, Abdul Jalil J. Taratingan, that he personally delivered the subpoena in General Santos City, received by a certain Jocelyn Nebria, is contrary to Revenue Memorandum Order No. 88-2010 which requires for a personal service to the person being summoned.
"It is only upon refusal of the person being summoned to receive the subpoena that a substituted service can be availed," said the DOJ.
The DOJ ruled that since there was no refusal on the part of Pacquiao to receive the subpoena, the BIR case is irregular and ineffectual.
"The service of summons is, indeed, a vital and indispensable ingredient of due process. Such denial of respondent's vital right constitutes a serious infirmity in the proceedings which led to the filing of this case against him," the DOJ said in its resolution.
Pacquiao's legal counsel, Atty. Abraham G. Espejo, expressed his gratitude to the DOJ.
"Congressman Pacquiao is and will continue to be a law abiding Filipino citizen," said Espejo.
The BIR has accused Pacquiao of violating Section 266 of Republic Act 8424, otherwise known as the National Internal Revenue Code of the Philippines.
BIR regional director Rozil Lozares claimed that Pacquiao snubbed the bureau's summons to present his tax records to the agency. - ANC and ABS-CBN News