The Court of Tax Appeals (CTA) has submitted for resolution the bid of Senator Emmanuel “Manny” Pacquiao and wife Jinkee to reverse its September 14 decision putting on hold the ruling on the couple’s plea to lift the tax lien on their properties.
In a resolution dated Nov. 17, the Tax Court has submitted the case for resolution after respondent, the Bureau of Internal Revenue (BIR) failed to comment on Pacquiao’s motion despite an extension granted by the court.
A tax lien attaches for as long as the deficiency taxes as well as the interest and surcharges have not been paid. The BIR issues a notice of tax lien to protect the interest of the government as stated under the Tax Code.
According to the BIR, the senator’s tax liability is P2.26 billion but it went up to P3.29 billion due to surcharges and penalties.
Aside from the tax lien, the BIR also issued a warrant of distraint and levy and garnishment order against the senator’s assets to cover his tax liability.
The Tax Court stopped its implementation but required him to pay either a P3.2-billion cash bond or a P4.9-billion surety bond which the senator questioned before the Supreme Court.
Pacquiao told the high court that their right to due process was violated when the BIR proceeded with the tax collection process even without serving a Final Decision on Disputed Assessment (FDDA) against them.
An FDDA is needed to give the taxpayer the opportunity to question the final decision of the BIR.
The senator added that the BIR has yet to present proof that they committed fraud in the payment of taxes from 1995 to 2009.
The high court has ruled in favor of Pacquiao and ordered the Tax Court to recompute the bond or determine if it can be waived.