DoJ recommends case after probe of BIR tax evasion complaint vs couple

THE Department of Justice yesterday recommended the filing of P73.85 million tax evasion charges against Ang Galing Pinoy Rep. Juan Miguel "Mikey" Arroyo and his wife before the Court of Tax Appeals.

The DoJ Task Force on Internal Revenue Cases found probable cause to indict Arroyo for three counts of failure to file income tax return and three counts of failure to supply correct and accurate information on his ITR.

The recommendation stemmed from the tax evasion charges earlier filed by the Bureau of Internal Revenue against the couple.

On the other hand, his wife Angela is facing seven counts of violation of Section 255 of the National Internal Revenue Code (NIRC) for also failing to file her income tax return for taxable years 2003 to 2009.

Arroyo said he was expecting the filing of the charges against him and his wife, saying "President Aquino's marching order to his men was to put his family behind bars.

"It is just unfortunate that my wife was included despite the fact that we have sufficiently disputed the allegations. But we've always believed in the rule of law and we will face the charges head-on because our conscience is clear. In the end I know we will be vindicated and justice will be served," Arroyo said in a statement shortly after reporters informed his lawyer about the indictment.

The couple was slapped with tax evasion cases by the Bureau of Internal Revenue last April for evading paying the correct amount of taxes due to the government.

The BIR claimed the couple failed to pay the correct tax which resulted in tax liabilities of P73.85 million, including surcharges and interest.

Also, the BIR alleged the Arroyos bought real, personal and other properties worth several millions from 2004 to 2009, including residential houses in the United States; Lubao, Pampanga and La Vista Subdivision in Quezon City; motor vehicles, stock shares, jewelry, clothes and other personal effects, as enumerated in Arroyo’s SALN as of December 31 of the years 2002 to 2009.

The BIR said that being a government official, Mikey’s only source of income is his salary.

But for the taxable year 2004, the couple reported a net income of P2.4 million; P1.7-million in 2006; P376,000 for 2007; and declared no income and did not file his ITR for the years, 2005, 2008 and 2009.

Angela, for her part, although she got a taxpayer’s identification number (TIN) for a one-time transaction, being unemployed, did not file her tax return. This means that she was either selling land or property, or shares of stocks.  For Angela to own shares in any company, she should earn money to buy those shares, even though she only registered as a taxpayer in 2004, Henares said.

The Arroyos’ failure to file their ITR is evident of their fraudulent scheme to defeat payment of taxes, the BIR charged. Worse, the substantial underdeclaration of income of more than 30 percent in the years 2004, 2006 and 2007, is considered prima facie evidence of fraudulent return, the BIR added.