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DoF to fine officials, others in tax scam

Finance Secretary Carlos Dominguez III said the government will slap charges against public officials and private individuals who unduly benefited from the issuance of tax credit certificates amounting to P11 billion to ineligible and non-existent textile companies from 2008 and 2014.

Dominguez said in a briefing Friday afternoon said the TCCs were issued by the One-Stop-Shop Interagency Tax Credit and Duty Drawback Center within the six-year period.

“From 2008 to 2014, the One-Stop-Shop Interagency Tax Credit and Duty Drawback Center erroneously issued around 3,231 TCCs contrary to the Omnibus Investment Code of 1987 to the detriment of the government. In particular, P8.85 billion tax credits were overstated and supported by spurious documents,” Dominguez said.

“While P2.34 billion tax credits were granted to claimants whose fiscal incentives had already expired,” Dominguez said.

Dominguez said he directed a high-level task force within the Department of Finance to recover the value of P11.18 billion worth of undue tax credits granted to these firms by OSS during the six-year period. 

Finance Undersecretaries Antonette Tionko, who heads the DoF’s Revenue Operations Group, Bayani Agabin of the Legal Affairs Group and Gil Beltran, who heads the Policy Development and Management Services Group, are the members of the task force.  

“Expect this department to pursue the appropriate charges against the public officers and private persons who manipulated and unjustly benefited from the tax credit process with the OSS,” Dominguez said. 

A tax credit certificate entitles an exporter to tax refund as part of an incentives package for local companies. A scam arises when companies submit fake documents to increase their tax claims.

Dominguez said the DoF task force was created in response to the findings of the Commission on Audit in a July 6, 2018 report on the erroneous issuance of 3,231 TCCs by the OSS from 2008 to 2014, in which P8.85 billion in tax credits were overstated and supported by spurious documents, and another P2.34 billion in TCCs were granted to claimants whose fiscal incentives have already expired.

Topics: Carlos Dominguez III , Department of Finance , Tax Credit and Duty Drawback Center , One-Stop-Shop Interagency Tax Credit , Commission on Audit
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