Why some of the richest Pinoys are not among top taxpayers

by Jon Carlos Rodriguez, ABS-CBNnews.com

Posted at Aug 29 2014 07:02 PM | Updated as of Aug 30 2014 07:25 PM

MANILA, Philippines – Forbes magazine recently released its list of the 50 richest Filipinos for 2014, but not all these tycoons are among the country’s top taxpayers.

Bureau of Internal Revenue (BIR) Commissioner Kim Henares explained that this is because the Forbes list is based on an individual’s net worth and not taxable income.

“’Yung Forbes richest list ito ay based on net worth nila, 'yung ari-arian nila. Kasama 'yung kumpanya nila, na maaaring pinuhunan nila dati ng mag-umpisa sila eh P1 million lang pero ngayon lumago ng lumago at mayroon silang mga share doon na hindi nila binebenta,” she said.

She said the BIR taxes the corporation as a whole and not the individual owners of the corporation.

Henares added that the individuals are only taxed when they receive dividends or salaries from the corporation, or if the shares are sold and disposed to another party.

“Nagiging tax lang ng may-ari ng korporasyon kung may dibidendo na in-issue sa kanya o kaya nagtatrabaho siya sa kumpanya at binabayaran siya ng sweldo so 'yun lang ang sina-subject sa tax,” said Henares.

“O kaya, kung namatay na siya at ipapabahagi na niya sa mga tagapagmana niya doon lang ho 'yan nabubuwisan o kaya ibebenta na niya ang shares pero habang hindi pa ho 'yan nabebenta o nadi-dispose, wala pa 'yang tax event,” she added.

Henares also said not all top taxpayers in the country are owners of publicly-listed companies, citing the case of 2012 top taxpayer Vivian Que Azcona, the owner of the biggest drugstore chain Mercury Drug.

“Hindi naman 'yan lumalabas sa Forbes list kasi 'yung Mercury Drug hindi naman publicly-listed, so hindi niya matingnan kung ano talaga ang value niya. Hindi siya nasa public domain,” she said.

Azcona is the country’s 18th richest with a net worth of about P40 billion ($935 million), and paid the highest income tax in 2012 amounting to P131.4 million.

The country’s richest man, SM’s Henry Sy Sr., paid P16.4 million in income taxes in 2012 to land at 74th on BIR’s list.

Forbes said Sy has an estimated net worth of about P554 billion ($12.7 billion).