Image Source: remate.ph
Image Source: remate.ph

MANILA — Commissioner Kim S. Henares of the Bureau of Internal Revenue (BIR) has disclosed massive tax fraud in the sale and transfer of real estate properties that caused the government to lose huge amounts of revenues from the so-called one-time transactions (ONETT) which involved payment of capital gains (CGT), donor, estate, and documentary stamp taxes.

The BIR raised last year more than P3 billion from ONETT, but insiders said the bureau could have collected more if the irregularities had been stamped out.[box type=”default” size=”large”] Scams caused gov’t to lose big amount of revenues [/box]The scams ranged from under declaration of the selling price to the use of fake certificate authorizing registration (CAR) of the property to its new owner or buyer with the register of deeds.

The BIR issues the CAR after the payment of the CGT, which is equivalent to 6 percent of the selling price and 2 1/2 percent documentary stamp tax.

Henares said there were also instances of misrepresenting the dead as living so that his heirs could avoid paying the estate tax in addition to CGT.

Properties located in the urban center are transferred to outlying areas to avoid payment of higher CGT and other ONETT taxes.

Revenue officials said the Jojo Labonete, head of the bureau’s assessment division in Urdaneta, Pangasinan, was killed recently by a syndicate after he uncovered one such anomalous transaction.

In Revenue Memorandum Order No. 7-2013, the BIR chief said there is a “proliferation of anomalous ONETT-related incidents,” particularly in Northern Luzon including the two Ilocos provinces, La Union, and Pangasinan.”

She instructed all district offices and assessment divisions in the regional offices to immediately transmit the fraudulent cases to their special investigation division (SID) for evaluation and inclusion in the Run-After-Tax-Evaders (RATE) program.

She said deals involving P10 million or more or for series of transactions perpetrated by the same individual or group of individuals should be forwarded to the National Investigation Division. (Jun Ramirez, Manila Bulletin)