3 ex-MWSS governing board members face tax evasion raps

MANILA, Philippines (UPDATED) - Tax evasion charges were filed by the Bureau of Internal Revenue (BIR) at the Justice Department on Thursday against 3 former governing board members of the Metropolitan Waterworks and Sewerage System (MWSS).

Charged were Oscar I. Garcia, Ferdinand P. Mahusay and Lorenzo S. Sulaik who were found to have concealed their true income "by their deliberate and willful failure to file their income tax returns (ITRs)."

The three sat as members of the Governing Board of the Corporate and Regulatory Offices of the MWSS.

Deputy Commissioner Estela Sales of the Legal and Inspection group bared that based on documents of the Commission on Audit (COA), Garcia earned P2.6 million, P3.5 million and P5.3 million from 2007 to 2009 but failed to pay the correct taxes amounting to P1.6 million in 2007, P1.982 million in 2008 and P2.7 million in 2009 for an estimated aggregate tax liability of P6.3 million, inclusive of surcharges and interests.

COA records showed Mahusay earned P897,220 for taxable year 2008 and P4.5 million for taxable year 2009. His total tax liability amounts to P2.715 million, inclusive of surcharges and interests.

Sulaik, meantime, earned P3.2 million and P4.5 million in 2008 and 2009 but failed to pay the correct taxes amounting to P4.051 million, inclusive of surcharges and interests.

Sales said the charges against the three were the result of separate investigations by the BIR following the Senate Committee on Finance inquiry on the "excessive salaries and unwarrante bonuses and allowances of GOCC (Government-Owned and -Controlled Corporation) and GFI (Government Financial Institution) executives."

The filing of separate criminal charges against Garcia, Mahusay and Sulaik are the 18th, 19th and 20th, respectively, under the Run After Tax Evaders (RATE) program of the BIR under the Aquino administration.

Tax evasion charges vs toy firm

Meantime, the BIR also filed tax evasion charges at the Department of Justice against a toy company for "willful attempt to evade or defeat payment of taxes and deliberate failure to supply correct and accurate information".

Wanly Toys International Corp. (Wanly Toys) and its responsible corporate officers were found to have deliberately underdeclared its income for taxable year 2008 amounting to a tax liability of P26.398 million, inclusive of increments.

Wanly Toys officers charged before the DOJ include Imee Tan Yao, president; Haide Yao, corporate treasurer; and William Pan, Jr., certified public accountant.

Wanly toys is engaged in trading imported toys and other items on wholesale basis. Its offices are located at Elcano St., Tondo, Manila.

BIR Deputy Commissioner Estela Sales of the Legal and Inspection Group bared that data obtained by the bureau's Reconciliation of Listings for Enforcement (RELIEF) System show that Wanly Toys made total sales amounting to P107.3 million in the year in question but underdeclared its income by P81.7 million or by 76.34%.

Under the Tax Reform Act of 1997, an underdeclaration of more than 30% is considered as "substantial underdeclaration" and constitutes prima facie evidence for a false or fraudulent return.

The case against Wanly Toys and its responsible officers is the 21st filed under the Run After Tax Evaders (RATE) program of the BIR under the Aquino administration.