Image Source:
Image Source:

[box type=”default” size=”large”] In connection with tax case filed vs boxing icon [/box]MANILA – Boxing idol Manny Pacquiao, who scored a unanimous victory over American Brandon Rios in their World Boxing Organization (WBO) international welterweight title fight last Nov. 23 in Macau, suffered a setback when the Court of Tax Appeals (CTA) ordered the freezing of his bank deposits in connection with a P2.2-billion tax case filed against him.

The tax court’s First Division issued the freeze order some two weeks ago but it was only known last Nov. 25. The boxing icon’s lawyers had earlier protested before the CTA a warrant of garnishment (WG) issued by the Bureau of Internal Revenue (BIR), attaching his personal assets that included his bank deposits.

The BIR normally issues WG to prevent delinquent taxpayers facing court suits from disposing of their assets during the trial.
The tax case arose from the alleged failure of Pacquiao’s accountant to report in his income tax returns (ITR) the multi-million-dollar taxes collected by the US Internal Revenue Service (IRS) from his prize winnings in 2008 and 2009.

Pacquiao said the assessment, which included interests and surcharges, was “arbitrary,” stressing he could not afford to pay the assessment because it was more than his net worth.

BIR lawyers said, however, that the tax debts have become “demandable, executory, and collectible” because Pacquiao allegedly ignored directive to answer the final assessment notice (FAN) sent to him, which expired 30 days after receipt as provided for in the Tax Code.
Revenue officials explained that as a Filipino citizen, Pacquiao, a congressman representing Sarangani Province, is required to declare in his ITR all his earnings, including those derived from abroad.

READ:  PHL exports growth in September highest in Southeast Asia -- NEDA

Records show that the boxing icon earned more than $28 million in prize money for successfully defending his various titles against Juan Manuel Marquez, David Diaz, Oscar de la Hoja in 2008, and Ricky Hatton and Miguel Cotto in 2009.

Of the amount, the IRS collected $8.4 million or roughly P395 million.

Pacquiao said he did not include remittances to IRS in his returns due to the existing bilateral tax treaty agreement between Manila and Washington, which stipulates that income tax paid by Filipinos in the US is creditable against his income tax liabilities in the Philippines.(MB)