BIR Commissioner Joel L. Tan-Torres clarified, “There is no political harassment whatsoever with this case but geared more towards collection of taxes due to the government as aptly decided by the Court.”

Last December 2009, the Court of Tax Appeals (CTA) ordered the City Government of Makati to pay the Bureau of Internal Revenue (BIR) more than P1.2 Billion in deficiency taxes.

In a CTA Decision dated December 16, 2009, the CTA dismissed the Makati City Government’s Petition for Review, and ordered the latter to pay the BIR the amount of P1,046,833,846.08 and P217,807,339.66, representing its deficiency taxes for taxable years 1999 to 2001, and taxable years 2002 to 2004, respectively.

The City Government filed a protest against this assessment, which was subsequently denied by the BIR Makati Regional Office.  Such denial was then appealed by the City Government, only to be denied once again by the BIR Makati Regional Office.  A Petition for Review was thus filed by the City Government with the CTA, requesting the reversal of this latter Decision.

The CTA’s dismissal of the Petition for Review was due to the City of Makati’s failure to appeal within the reglementary period before the said Court the assessment in question. Considering that the Final Decision on Disputed Assessment (FDDA) issued by the BIR Makati Regional Office on October 16, 2003 was not protested by the taxpayer before the Commissioner, the FDDA thus became the BIR’s final decision on the matter and is considered to be final, executory, demandable and unappealable.

BIR Makati Regional Director Jaime B. Santiago and Assistant Regional Director Manuel Mapoy are still discussing an amicable settlement of the case with Makati Mayor Jejomar Binay. If the Makati City government still fails to settle the tax debt, BIR would then exhaust all legal remedies like the garnishment of the City Government’s bank account/s to collect said liability.

BIR Commissioner Joel L. Tan-Torres clarified, “There is no political harassment whatsoever with this case but geared more towards collection of taxes due to the government as aptly decided by the Court.”