ABS-CBN has no tax delinquency, BIR tells solons

Christian V. Esguerra, ABS-CBN News

Posted at Jul 01 2020 06:27 PM

ABS-CBN headquarters in Quezon City on June 30, 2020. Gigie Cruz, ABS-CBN News

MANILA--ABS-CBN Corp. has no current tax delinquency and, with the rest of the companies under the ABS-CBN Group, infused a combined P71.5 billion in taxes to government coffers in 17 years, congressmen scrutinizing its application for a new broadcast franchise were told Wednesday.

The company also set the record straight that ABS-CBN Corp. did not have a "negative 5-percent effective tax rate for 2018," an allegation that has been raised in the joint House hearing as well as in social media. 

In fact, ABS-CBN paid P164 million--not negative P84 million--that year, said Ricardo Tan, the group's chief financial officer.

Asked by Minority Leader Benny Abante if he could honestly say that ABS-CBN honestly paid taxes to the government, Tan replied: "Yes, we can."

ABS-CBN Corp., whose broadcast operations were ordered shut down by government regulators on May 5, remitted P15.3 billion in taxes from 2016 to 2019 alone, said Assistant Commissioner Manuel Mapoy of the Bureau of Internal Revenue (BIR). 

The company has been "regularly paying its corporate taxes for the past years," he told the House Committee on Legislative Franchises and House Committee on Good Government. 

"There is no outstanding delinquent accounts as we speak," he added, but noted that ABS-CBN was still under investigation for 2019 while those for previous years have been completed.

From 2003 to 2019, the ABS-CBN Group of companies (including ABS-CBN Corp.) paid a total of P71.5 billion in taxes, said Tan.

Bayan Muna Rep. Carlos Zarate reminded his colleagues that such would roughly be the amount that the government would lose should Congress reject ABS-CBN's application for a new 25-year operating franchise.

A number of congressmen seeking to deny a new franchise for the network, which had been repeatedly criticized by President Rodrigo Duterte, have accused ABS-CBN of constitutional, labor, tax and other violations.

Zarate agreed that Congress should scrutinize the company's tax payments over the years.

"Pero tama rin ba na yung nagbabayad ng buwis ay patayin natin at hindi na sya makapagbayad ng buwis pa sa mga darating na panahon?" he said.

(But is it also right to kill a company that has been paying its taxes, thereby keeping it from paying more in the coming years?)

Tan also denied allegations that ABS-CBN Corp. was using its donations to the Lingkod Kapamilya foundation as a tax shield.

"That is false. We were very transparent with the support that we provide to ABS-CBN foundation," he said.

ABS-CBN chief financial officer Aldrin Cerrado also denied that the company ever made use of the foundation "as a conduit just to escape tax liability," a question raised by Zarate.

ABS-CBN donations to Lingkod Kapamilya are not subject to donor's tax since the foundation is BIR-registered and accredited by the Philippine Council for NGO Certification, he said.