Lawmaker falls victim to tax scam

A House of Representatives member who belongs to a landed and wealthy business family yesterday claimed falling victim to a tax diversion scandal even as the government continues to crack down on such illicit operations.

Rep. Juan Miguel Zubiri, in a speech at the House of Representatives, said corrupt personnel of the Bureau of Internal Revenue (BIR) and the semi-government United Coconut Planters Bank (UCPB) had diverted P20 million ($400,000) in tax payments by four of his family's popular food companies.

Zubiri said they took note of the tax diversion scam after they received notices of non-payment of taxes from July, 2000, to May, 2002, from the BIR. Zubiri said the local Asiatrust, the firms' bank, had started an investigation on tax payments made by the Zubiri companies through UCPB.

The probe found that the funds were never remitted to the BIR. Several local banks are allowed by the BIR to accept tax payments on its behalf.

Zubiri said the investigations revealed that the payments were deposited to an account named to a certain "Alfredo delos Reyes" in UCPB.

"This is not to destroy the reputation of a fine and well-run bank such as UCPB," the congressman said.

"My point is to posit the theory that syndicates have burrowed inside our banking system and from there have been surreptitiously intercepting BIR-bound tax payments," he added.

The discovery of the latest tax diversion scam follows the unearthing of a similar operation three weeks ago involving the diversion of a total P270 million ($5.4 million) tax payment by several firms to three bank accounts named to fictitious individuals.

The government is currently carrying on a crackdown on tax cheats and is instituting reforms in the BIR amidst a ballooning budget deficit which had been traced to poor tax collection by the revenue agency. The scandals forced the head of the BIR to quit his post.