Julia Christine Botin

SC: Taxpayers liable for unpaid taxes despite acquittal from criminal raps

The Supreme Court building in Manila. April 21, 2014. Jonathan Cellona, ABS-CBN News.

Article (news)

Adrian Ayalin

ABS-CBN News

MANILA -  The Supreme Court has reiterated that even if a taxpayer is acquitted of a criminal charge, he or she remains liable for any unpaid taxes. In the decision of the 2nd Division promulgated on January 24, 2024, the high court dismissed the criminal cases against E&amp;D Parts and Supply, Inc. and its treasurer, Margaret Uy, due to lack of evidence. At the Court of Tax Appeals, the cases against E&amp;D and Uy were also dismissed, but the Office of the Solicitor General argued before the Supreme court that the company should still pay the tax due regardless of the acquittal. “The taxpayer’s obligation to pay the tax is created by law, it does not arise from the offense of tax evasion. Accordingly, acquittal of the accused or the dismissal of the criminal case for tax laws violation will not result in the extinction of their civil liability,” the court said in the decision penned by Associate Justice Mario Lopez. But the court said in the decision that the company was not required to pay the assessed tax due to an invalid tax assessment. The court added that the assessment for deficiency income tax and value added tax for taxable year 2006 against E&amp;D was void for having been issued without a valid letter of authority. “Hence, the dismissal of the case against E&amp;D is in order,” the court said.

The Supreme Court has reiterated that even if a taxpayer is acquitted of a criminal charge, he or she remains liable for any unpaid taxes.

The Supreme Court has reiterated that even if a taxpayer is acquitted of a criminal charge, he or she remains liable for any unpaid taxes.