Pacquiao in a Corner


Manny Pacquiao is set in a corner by the Bureau of Internal Revenue for, you guess it, non-payment of taxes.

I am sure that there has been a mistake, or rather, misunderstanding, or maybe misinterpretation.

Everybody knows that Manny would pay his taxes dutifully, but the BIR is not the Internal Revenue Sevice of the U.S.

There are still obligations to be met in the Philippines.

The standing rule between the U.S. and the Philippines, or for any other country for this matter, is thatr if Manny pays his taxes in the States for income in America, he does not have to pay Philippine taxes for this income. But then Manny has to specify amounts and specific data relevant to the income. Documents must be shown to prove such data. If Manny has lawyers or counsels to advise him about his tax dues, he should have fired them by now.

The BIR’s garnishment of Manny’s assets seem to be excessive in quantity and abusive in quality. It seems that just about everybody is getting head over heels over this minor matter. I say minor because Manny is ready to pay his dues. After all, he thought that he already paid his dues. One thing may be in order—the BIR must know exactly how much undeclared amounts he acquired before making any garnishment. The BIR must know exactly how much he owes to the penny. This amount should be recovered from the official returns submitted to the IRS. If the BIR starts garnishment proceedings against Manny with the amount in question,  then the BIR already has a copy of the returns submitted to the IRS. So what’s the “pasiklab” all about?

A lot of lawyers and counsels do not seem to know the way to process such a situation that Manny is in now. I’ve been observing the progress of this news over the media. It would have been best for Manny to request the American IRS to send a copy of Manny’s tax payments directly to the BIR. With the big amount that Manny has paid the IRS, I am sure that the IRS will accomodate him.

Any such relevant document that Manny will forward to the BIR by himself must carry the official seal of the IRS to prove authenticity.

Moral of the story : do not earn less money than the BIR can garnish from you!



Campaign Tax?

Now I am sure that some people’s lids have flipped.

Malacanang has decreed that all those campaigning for the coming national elections will be taxed from the expenses that they incur. They will not get taxed by the amount of donations they receive for their campaigns, but for the amount of money they spend from these contributions. The BIR, short for Bureau of Internal Revenue, explains that this tax is a form of withholding tax wherein the candidates will withhold a percentage of the amount spent on the campaign and then remit this amount to the BIR.

 Now, taxes may be withheld from employees by their employers, from merchandise sales by the vendors, and maybe from some specialized transactions which are made for the purposes of making a profit, each occasion has the seller withholding the tax.

 To remit to the BIR these specific campaign taxes would imply that the candidates are to be considered employers engaged in service or sales to the public and may generally be engaged in business for profit. These candidates will therefore have to be registered and given  a BIR number to which they are going to send the withholding tax remittances.

But of course, if malacanang will consider the candidates as engaged in business already, the profit in question would be realized in the future, IF  AND  AFTER they win their public positions.

 In which case the ‘profit’ we are talking about is just the plain and simple ‘kupit’.