Illegal tax credits hit P606M

The errant firms had illegally acquired the tax credit certificates over a four-year period from 2008 to 2012

Illegal tax credits availed by four textile firms reached P606 million, the Department of Finance (DoF) said on Monday following the Commission on Audit’s (CoA) issuance of notices of disallowance (ND) for such.

“The errant firms had illegally acquired the tax credit certificates (TCC) over a four-year period from 2008 to 2012,” the agency said.

“Several officials and employees of the DoF, Board of Investments (BoI), Bureau of Customs and OSS (One-Stop Shop Inter-Agency Tax Credit and Duty

Drawback Center) who were responsible for processing and approving the illegal TCC, as well as their recipients and claimants from the four companies, were held liable by CoA in various instances,” it added.

Among the delinquent firms included Capital-Roll Knit Corp. managed to slip P285.58 million and P40.88 million of tax perks in February and June, respectively, which adds up to the combined amount of P83.56 million TCC in 2010 and 2011 to total at P410.02 million to date.

Another erring firm, Uni-Glory’s Knitting Corp. received illegal tax credits of P78.02 million.

The remaining firms, Primeknit

Manufacturing Corp and Tai-Cheng International Resource Inc. meanwhile managed to secure illegal tax perks of P55.89 million and P62.03 million, accordingly.

According to the DoF, tax credits are provided as incentives to exporters and manufacturers of BoI-registered products for export that have paid the necessary taxes.

“Approved applications meant refunds on (firms’) duties and taxes that were used to pay other tax liabilities due the government,” it explained.

To recall, the CoA foiled an P11.18 billion scam of 33 unqualified non-existent textile companies from 2008 to 2014, to which Finance secretary Carlos Dominguez III took immediate action by forming a task force to investigate and run after such firms.