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COA invalidates P3-b tax credits granted to textile firms

The Commission on Audit invalidated P3 billion worth of tax credits granted to several textile companies from 2008 to 2014, according to the Department of Finance.

A report by the COA Special Audits Office to Finance Secretary Carlos Dominguez III said it disallowed another set of tax credit certificates worth P412.77 million, on top of the previous batches of TCCs it invalidated amounting to P2.6 billion.

This brought the total value of illegal TCCs issued by the One-Stop-Shop Inter-Agency Tax Credit and Duty Drawback Center to these textile firms to P3 billion as of Sept. 21, the date on the report sent to Dominguez by COA-Special Audits Office director Gloria Silverio.

It identified the textile firms with invalidated TCCs as Silvertex Weaving Corp., Knitech Manufacturing Inc., Capital-Roll Knit Corp., Uni-Glory’s Knitting Corp., Primeknit Manufacturing Corp., Tai-Cheng Integrated Resource Inc., Miskhu Industrial Corp. and Universal Pacific Knitting Mills Inc.

Silvertex remained on top of the list with the largest amount of illegal TCCs at P906.80 million, followed by CRC with P664.92 million.

The COA said it found a new set of TCCs that were illegally issued to Miskhu Industrial worth P315 million, on top of the P136.98 million in tax credits granted to the firm that were also invalidated by the audit body. This brought the total value of MIC’s illegal TCCs to P451.98 million.

Illegal TCCs issued to Primeknit worth P97.77 million were also uncovered by the COA, aside from the P214.31 million granted to the firm that were invalidated. Primeknit’s invalidated tax credits now total P312.08 million.

Several past officials and employees of the Department of Finance, Board of Investments, Bureau of Customs and One-Stop-Shop Inter-Agency Tax Credit and Duty Drawback Center who were responsible for processing and approving the illegal tax credit certificates issued between 2008 and 2014, as well as the recipients and claimants from the six companies, were held liable by COA.

Topics: Commission on Audit , COA , tax credits , Department of Finance
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