The Bureau of Internal Revenue (BIR) showed resolute seriousness, in spite of threats to life and limbs, in its crackdown of business establishments found violating tax laws when it shuttered yesterday two (2) related companies in Pasig City pursuant to its Oplan Kandado Program.

Padlocked were PRODUCT INDUSTRIAL CONTRACTORS (PIC) and PIC ENTERPRISES, INC. (PICEI) both located at No. 745 C. Raymundo Avenue, Maybunga, Pasig City.

The subject sister corporations were issued closure orders last February 16, 2011 by Operations Group Deputy Commissioner Nelson M. Aspe after they failed to comply with the requirements mandated in the 48 Hour and 5-Day VAT Compliance Notices given to them.

Both companies were found to have grossly underdeclared their taxable sales for purposes of the VAT by as much as 100% in taxable years 2007, 2008 and 2009.

PIC was shut down for failure to file VAT returns and pay the correct VAT, attempt to evade or defeat tax, perjury, and failure to supply correct and accurate information. The VAT liability of PIC after investigation amounted to P3,395,391.72, including surcharges and interests, broken down as follows: 2007 – P1,493,553.84; 2008 – P995,822.14; and 2009 – P906,015.74.

PICEI, on the other hand, committed acts constituting violations of the Tax Code such as failure to pay correct income tax, failure to file VAT returns and pay the correct tax thereon, attempt to evade or defeat tax, and perjury. Records of investigation show that PICEI incurred deficiency VAT in the total amount of P44,497,988.02, including increments. The figure represented VAT deficiency of P16,419,100.02 in 2007, P22,107,511.44 in 2008, and P5,971,376.56 in 2009.

The two cases were the result of continuous work of Revenue District Office No. 43B, West Pasig City pursuant to its NON-FILER program. Both companies were found to have not filed returns during verification. Typhoon Ondoy was given as a reason by the taxpayers to cover for such failure to file the required returns. There was even a belated attempt to file the returns which bore incomplete details, payment of penalty for late filing, and a single filing date of December 16, 2010.

Revenue District Officer Luis A. Alberto, Jr. said that the two corporations will remain closed until they have complied with the BIR requirements, including payment of their deficiency taxes.

The twin closures were made pursuant to the Oplan Kandado flagship project of the BIR in the administration of Commissioner Kim S. Jacinto-Henares.