BIR's Kim Henares coddles and lawyers for tax evader!

Philippines’s Bureau of Internal Revenue Commissioner Kim Henares, who established a reputation that of an unyielding tax-evader-buster, coddles and lawyers for Philippine Daily Inquirer (PDI) Chair Marixi Rufino-Prieto firm Golden Donuts, Inc. (GDI), the exclusive Philippine Franchisee of the global brand “Dunkin’ Donuts” – a bigtime tax evader.

Othello E. Dalanon, in his official capacity as former BIR Revenue Officer, conducted investigation of the 2007 financial records of GDI for internal revenue tax purposes where he discovered and documented irregularities perpetrated by the said company that culminated in the tax assessment amounting to PhP 1.56 billion, including increments.

Dalanon personally reported GDI’s omissions to Commissioner Henares and recommended to her the criminal prosecution for tax evasion under the much-vaunted “Run After Tax Evaders” (RATE) Program of the Bureau; but she intentionally failed to pursue fraud case against the said company because its secretary – Marixi Rufino-Prieto who also happens to be the Chairperson of Philippine Daily Inquirer (PDI) – is President BS Aquino 3^rd’s friend.

The aforesaid deficiency tax assessment obtained finality because GDI failed to file a VALID PROTEST against the Formal Letter of Demand and Assessment Notice (FAN).

However, Henares intentionally did not enforce collection thereof, purportedly because representatives of GDI complained to her that Dalanon’s tax assessment against the said company was allegedly faulty; that is why she ordered two (2) re-investigations conducted by different groups of revenue officers who supposedly arrived at similar results, finding Dalanon’s assessment to be incorrect, she said.

There is no LAW that authorizes the Commissioner to order two (2) re-investigations of a FINAL, EXECUTORY and DEMANDABLE assessment.

Once the deficiency tax assessment obtained finality, the right of the government to collect the deficiency tax becomes absolute; thus, precludes the taxpayer from questioning the correctness of the assessment and from raising any justification or defense that would pave the way for a re-investigation.

Notwithstanding the ensuing finality of the said assessment, the Commissioner allowed such re-investigations.

The “first re-investigation”, which is no longer warranted because Dalanon’s tax assessment which remained undisturbed after review and evaluation conducted by high-ranking officers in the district and regional levels of the agency, and already covered by Formal Letter of Demand and Assessment Notices (FANs) bearing Demand No. 41-B072-07 and all dated October 29, 2010 obtained finality, was assigned to Revenue Officer Stanley Ong, under Group Supervisor Gregorio S. Tumanguil, who was the same revenue officer that conducted the review of the case and recommended for the issuance of the statutory notices of assessment (PAN and FAN) when he was yet with the Assessment Division of the Regional Office in Quezon City.

Former Revenue Officer Dalanon is not a lawyer though he believes that Revenue Officer Stanley Ong who conducted the “first re-investigation” could no longer disturb the former’s tax assessment for reasons of principle of estoppel. The equitable principle of estoppel forbids the latter, who conducted the “first re-investigation”, from taking inconsistent position against his concurrence to the former’s original audit findings that culminated in the deficiency tax assessment amounting to PhP 1.56-B which is already FINAL, EXECUTORY and DEMANDABLE but which was re-investigated by no other than Revenue Officer Ong himself.

The “second re-investigation”, which is also no longer necessary as Dalanon’s tax assessment obtained finality, was referred to Atty. Grace Cruz of the National Investigation Division in the National Office of the BIR. Dalanon strongly admires Atty. Cruz of her investigative expertise in administrative cases. Lest it be misconstrued. Dalanon is not saying that Atty. Cruz is short of proficiency in tax accounting and tax auditing. No result of re-investigation was submitted by Atty. Cruz.

So, how can Henares claim that her groups of revenue officers who conducted the supposed two (2) separate re-investigations came up with the same findings that Dalanon’s assessment against GDI was incorrect?

Henares also claims that the authority to decide and declare finality of a certain assessment is a function vested by law upon the Commissioner of Internal Revenue.

Her assertion does not find basis in LAW.

It is the LAW that determines finality of a certain assessment as clearly provided under Revenue Regulations (RR) No. 12-99 as amended by RR No. 18-2013 which the Commissioner herself promulgated, in relation to Section 228 of the 1997 National Internal Revenue Code (1997 Tax Code), as amended.

Just to reiterate. The P1.56 billion tax deficit of GDI “Dunkin’ Donuts” has become DUE and DEMANDABLE, thus, it already legally belongs to the FILIPINO people; but Henares intentionally did not collect.

Atty. Kim Henares, just tell the truth and nothing but the truth!!!

Othello E Dalanon

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