The Bureau of Internal Revenue (BIR) today filed a criminal complaint with the Department of Justice against TIRSO EDWIN L. GARDIOLA (GARDIOLA) for willful attempt to evade or defeat tax and deliberate failure to supply correct and accurate information in his Income Tax Return (ITR) for taxable year 2006 and for willful failure to file his ITR for taxable years 2007 to 2009 resulting to non-payment of taxes due thereon, all in violation of Section 254 and Section 255 of the National Internal Revenue Code of 1997, as amended (Tax Code).
Documents show that BIR investigated GARDIOLA for taxable years 1999-2010. GARDIOLA, however, refused to cooperate with the BIR by not making his books of accounts and other accounting records available for examination despite the issuance of the required Letters of Authority, Notices and even Subpoena Duces Tecum.
In the course of the investigation, the BIR discovered that GARDIOLA filed his Annual ITR only for taxable year 2006. BIR likewise unearthed various purchases of motor vehicles by GARDIOLA through documents obtained from the Land Transportation Office (LTO). From November 2006 to July 2009, GARDIOLA bought a BMW 74511, Lincoln Navigator, Lexus LX470, Volkswagen Coupe, Camry 3.5Q A/T, Land Rover Range Rover 4.2 V8 S/C, Land Rover Freelander 2 2.2, Jaguar XKR 4.2 Coupe and KIA Mohave A/T.
GARDIOLA did not file his ITRs for taxable years 2007 to 2009 but acquired motor vehicles in the total amount of P30.38M in the same years. Although GARDIOLA filed his ITR for 2006 showing a gross taxable income of P0.77M, he paid income tax thereon in the amount of P1,856.00 only, which is grossly disproportionate to the amount of P4.75M that he paid for the BMW 74511 that he bought in November 2006.
Using the Expenditure Method of tax investigation, the BIR computed GARDIOLA’s estimated unreported income at P18.87M, P16.40M, P3.98M, and P11.14M for taxable years 2006, 2007, 2008 and 2009, respectively. GARDIOLA’s total estimated income tax liability was pegged at P35.20M, broken down into: P14.86M – 2006; P11.55M – 2007; P2.57M – 2008; and P6.22M – 2009.
The expenditure method states that if one’s expenditures exceed his reported income for a given year and the source of the funds to make the expenditures is unexplained, such expenditures represent unreported income.
The case against TIRSO EDWIN L. GARDIOLA is the ninety-third (93rd) filed under the Run After Tax Evaders (RATE) program of the BIR under the leadership of Commissioner Kim S. Jacinto-Henares.