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Friday, March 29, 2024

BIR loses P2.9-b tax case vs Estrada

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THE Court of Tax Appeals  on Tuesday  dismissed a 2001 tax assessment of P2.905 billion on Manila Mayor Joseph Estrada and his wife, former senator Loi Ejercito.

“While it appears that the assessment contains factual and legal bases, the court is not precluded from evaluating the propriety of the facts and the law on which it is based,” the court’s decision read.

The tax court said the tax appraisal on the Estradas “cannot be sustained,” adding the assessment arose from the account in the name of Jose Velarde, allegedly belonging to Estrada.

“There is no identity of parties between Criminal Case No. 26658 [the plunder case] and the present case,” it noted, referring to the Estrada’s conviction for plunder.

The plunder case cannot be reapplied for the purpose of taxation, it said.

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“Where the BIR has come out with a ‘naked assessment,’ i.e. without any foundation character, the determination of the tax due is without rational basis,” the court said.

The CTA slammed the Bureau of Internal Revenue for violating Estrada’s right to due process.

It reversed the deficiency income tax assessment and June 19, 2009 letter of demand and the Sept. 26, 2009 BIR decision.

The camp of Estrada welcomed the CTA’s decision, saying his impeachment was a political persecution.

Ferdinand Topacio, lawyer of the Estradas, said the decision is not just a victory of the couple, but of the ordinary taxpayers.

“The BIR is still in the habit of assessing taxes without any basis. In November 2001, the Estrada couple were assessed of having a tax deficiency of P2,905,048,539.98,” Estradas’ lawyer said.

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