BIR Says Manny Pacquiao Shall Submit Proof He Pays Tax in US

The solution to Manny Pacquiao’s tax troubles is simple.

According to BIR Commissioner Kim Henares: submit proof that he paid his taxes in the US.

On Wednesday, Pacquiao showed to GMA News a purported copy of his US nonresident alien income tax return for the year 2008-2009.

But the BIR has denied receiving any documents that would prove that Pacquiao paid his US taxes, which under a tax treaty between the Philippines and the US, would cover Pacquiao’s Philippines taxes for the same income.

Pacquiao had presented to GMA News what appeared to be a copy of his US nonresident alien income tax return for the year 2008-2009.

The BIR has denied receiving any documents that would prove that Pacquiao paid his US taxes, which under a tax treaty between the Philippines and the US, would exempt Pacquiao from paying at least much of his Philippines taxes for the same income.

GMA News is trying to get a reaction of the BIR to Pacquiao’s US tax document.

Pacquiao also showed a letter bearing the letterhead of accounting firm Tanner, Mainstain, Blatt, Glynn & Johnson which Pacquiao said committed to give its full cooperation to the BIR.

Pacquiao said he submitted these documents to the BIR when he was asked to submit proof of his US income and taxes paid.

According to Henares, Pacquiao has sent a document to the BIR, but it was a mere letter from his promoter, Top Rank Promotions.

But Pacquiao’s lawyer Tranquil Salvador argues that the boxing champ has already turned over the documents from the US’ Internal Revenue Service (IRS), but can’t show them to the media.

The documents are already with the Court of Tax Appeals which is hearing a case filed by Pacquiao against the BIR.

Pacquiao, also Sarangani congressman, claimed in a press conference Tuesday that his bank accounts were frozen because of his tax case and needed to borrow money to help Yolanda victims.

In addition to the BIR’s threat to seize Pacquiao’s bank deposits to cover his P2.2-billion tax liabilities, the agency is also eyeing the national icon’s immense real estate properties.

Henares said the matter is a simple case of tax collection, and has asked two banks where Pacquiao is known to have deposits to hold the money in lieu of delinquent tax payments.

Surprisingly, the only known Philippine bank accounts of the purported billionaire Pacquiao contain only P1.1-million.

If Pacquiao cannot show proof that he paid taxes in the US in lieu of Philippine taxes based on his earnings in lucrative Las Vegas fights, he may get in trouble with US tax authorities as well.

Meannwhile, in a phone patch interview, Pacquiao’s promoter, Bob Arum, said the boxer has religiously paid his tax obligations and what is needed is a certification from the United States’ Internal Revenue Service stating the tax payments Pacquiao has made. The Top Rank president said the IRS has yet to issue that certification.

Manny’s accountant in the US has asked IRS to send such certification… IRS has yet to send certification because the bureaucracy is so slow, Arum said.

He also said his income in those two years was not large enough to lead to a tax liability of over P2 billion.

Pacquiao said the deposits in the two banks that the BIR were able to garnish were the accounts of his wife, Jinkee.

accounts were frozen because of his tax case and needed to borrow money to help Yolanda victims.

In addition to the BIR’s threat to seize Pacquiao’s bank deposits to cover his P2.2-billion tax liabilities, the agency is also eyeing the national icon’s immense real estate properties.

Henares said the matter is a simple case of tax collection, and has asked two banks where Pacquiao is known to have deposits to hold the money in lieu of delinquent tax payments. Surprisingly, the only known Philippine bank accounts of the purported billionaire Pacquiao contain only P1.1-million.

If Pacquiao cannot show proof that he paid taxes in the US in lieu of Philippine taxes based on his earnings in lucrative Las Vegas fights, he may get in trouble with US tax authorities as well.

But in a phone patch interview, Pacquiao’s promoter, Bob Arum, said the boxer has “religiously” paid his tax obligations and what is needed is a certification from the United States’ Internal Revenue Service stating the tax payments Pacquiao has made. The Top Rank president said the IRS has yet to issue that certification.

He also said his income in those two years was not large enough to lead to a tax liability of over P2 billion.

Pacquiao said the deposits in the two banks that the BIR were able to garnish were the accounts of his wife, Jinkee.
enares said Pacquiao’s tax case has been pending for two years and that the revenue agency has given the boxer every opportunity to address his tax liability.

Henares said the BIR issued a notice of levy to Pacquiao to inform him of his tax liability of P2.2 billion.

Arum said Pacquiao’s tax payments are made in the form of withholding taxes and via electronic payments.