Deputy Speaker Rondate Marcoleta accused ABS-CBN of tax evasion during the house hearing on the franchise issue of the television network giant.
Marcoleta who has gone viral on social media because of his revelations claimed that GMA-7, a media company smaller than ABS-CBN paid a bigger tax in 2018, while ABS-CBN declared a negative income tax.
According to him, that Kapamilya network allegedly evaded tax by using its subsidiary, Big Dipper Inc as a tax shield, because it enjoyed the benefit of being a company registered at the Philippine Economic Zone Authority (PEZA).
“ABS-CBN also violated the terms and conditions of its franchise by engaging in tax avoidance schemes which deprived the government of the much-needed revenue,” said Marcoleta.
“It used its fully owned subsidiary, Big Deeper Digital Content and Design Inc., a PEZA registered company as a tax shield. Its main customer is ABS-CBN Hungary. And because of this tax avoidance scheme, ABS-CBN alleged effective tax rate in 2018 was at a negative 5 percent. This means that ABS-CBN manages to avoid paying taxes in 2018, ” he added.
He then compared GMA-7 to ABS-CBN, asking why a bigger company like ABS-CBN is paying less tax than its rival network.
Marcoleta said that it turned out that the government owes ABS-CBN in 2018 because it declared a negative 84-M income tax.
“Bakit ang GMA 7 na hindi kasing laki o kasing yaman ng ABS-CBN ay nakapagbayad ng buwis sa pamahalaan ng P1.6 billion noong 2018. Samanatalang ang ABS-CBN ay walang binayarang buwis. Bakit naman nakalibre ang ABS-CBN noong 2018 sa negative income tax nila na 84 million. Ibig sabihin nito ay may tax credit ang ABS-CBN at gobyerno pa ang lumalabas na may utang dito. Wala po itong pagkakaiba sa isang taong umutang sa tindahan at binigyan pa ng sukli,”
This is not the first time that someone mentioned the alleged tax evasion activities of ABS-CBN.
One of GMA-7 top official Anette Gozon-Valdes even commented on Ramasola’s post, joking if their company could copy the technique of ABS-CBN.
“Oh baka GMA can copy this too to avoid paying taxes hehe,” Gozon said.
“Seriously though. Maybe you have some auditor fb friends that can give their opinion? Pasado naman kasi ang scheme na ito sa auditor nila,” she added.
Meanwhile, a tax expert said that the tax evasion accusation against ABS-CBN is unfair.
“Whether this subsidiary is legitimate or not, we have the Securities and Exchange Commission (SEC). Whether ABS-CBN paid all the taxes or not, (The Bureau of Internal Revenue) BIR is checking on ABS-CBN every year,” Founding chairman of the Asian Consulting Group Mon Abrea said.
He also called the post of Ramasola as misleading.
“None of these large taxpayers can ever have a negative tax rate, because they are all subject to withholding taxes. It’s like the situation of the employee (wherein) before they receive their salaries it’s already net of taxes,” he said.
He also has a reminder to people accusing ABS-CBN of evading tax.
“Tax avoidance is not illegal. Having a foreign subsidiary is not illegal. And there’s nothing immoral about it other than us putting malice or crucifying (ABS-CBN) just because we don’t like these people.” he also said.