Chinese firm in P713-M tax evasion rap


Posted at Aug 12 2010 01:21 PM | Updated as of Aug 12 2010 09:33 PM

MANILA, Philippines - The Bureau of Internal Revenue (BIR) has filed before the Department of Justice tax evasion complaints against 2 companies, including the subsidiary of a construction firm blacklisted by the World Bank for allegedly rigging bids for road projects.

BIR Commissioner Kim Henares said the first complaint was filed against China State Philippines Construction Engineering Corp., which, she said, failed to pay around P712.74 million in taxes from 2003 to 2006.

Henares said the company was also deducting creditable withholding tax using the tax certificate issued to its parent, China State Construction Corporation Limited.

"Based on record of DPWH (Department of Public Works and Highways), there is no contract between the Philippine government and China Philippines so they should not be using the creditable withholding tax on VAT or income of another company," Henares told ANC.

Charged for tax evasion were China Philippines managing officer and chairman of the board Fu Yu Cheng, president and director Fu Chun Yan, secretary and director Gerald Telebrico, chief finance officer Huang Xin Yu, and vice president Wu Zhi Gang. Also charged was their accountant, Daisy Guerrera, for allegedly making false entries in the 2004 and 2006 income tax and VAT returns of China Philippines.

China Limited was one of the 7 construction companies blacklisted by the World Bank for alleged corruption in the bidding for local road projects funded by the multilateral agency. Specifically, the firms were discovered to have formed a cartel and colluded in the auction of the National Roads Improvement Program or NRIMP 1 last year.

Graphics firm charged too

Henares said the BIR also filed a tax evasion complaint against Grand C Graphics Inc. for failing to pay tax deficiencies, and non-remittance of taxes withheld.

Charges were slapped against Gloria dela Cruz, the company's president, and Deborah Cing, the treasurer.

"We have already assessed them and they did not pay us. And they have been filing electronic returns, but not remitting the payments. They filed 90 returns, but there were no payments," Henares lamented.