BIR files Php132.5-M tax evasion rap vs. CashCashPinoy mother company Moonline Inc.

By on February 5, 2015


CashCashPinoy founder Frederic Levy (Wikipedia photo)
CashCashPinoy founder Frederic Levy (Wikipedia photo)

MANILA — The Bureau of Internal Revenue (BIR) on Thursday filed before the Department of Justice (DOJ) a Php132.51-million tax evasion case against a Makati City-based online selling company.

Charged were Moonline, Inc. (Moonline), together with its president Frederic Elie Levy and treasurer Bernadeth Levy.

In a press conference, BIR Commissioner Kim S. Jacinto-Henares said that they charged the respondents for willful attempt to evade or defeat tax, and deliberate failure to supply correct and accurate information in its income tax returns (ITRs) for taxable years 2011, 2012 and 2013, in violation of Sections 254 and 255 in relation to Sections 27, 253 and 256 of the National Internal Revenue Code of 1997.

Moonline is a Philippine corporation registered with the Securities and Exchange Commission (SEC) and the BIR.

It is engaged in the sale of products and services through the online website CashCashPinoy which includes apparel, restaurants and bars, salons and spas, special events, health and fitness products, and travel packages.

The case arose from the BIR’s campaign to improve revenue collections to meet its collection target by capturing into the tax net the sale of products and services through online websites.

One of its customers/withholding agents, BDO Unibank, Inc., disclosed that it remitted to the BIR creditable taxes in the amount Php48.98 million in 2011, Php155.18 million in 2012 and Php199.89 million in 2013 for income payments made to Moonline.

Investigators found that Moonline declared in its ITRs for taxable year 2011, 2012 and 2013 gross income amounting to only Php39.78 million, P46.26 million, and P71.89 million, respectively.

Henares said that Moonline received total income payments amounting to Php49.09 million in 2011, Php157.35 million in 2012 and Php201.77 million in 2013, thus substantially underdeclaring its correct taxable income by 23% or Php9.31 million in 2011, by 240% or Php111.09 million in 2012 and by 181% or Php129.88 million in 2013.

She added that as a consequence of its acts and omissions, Moonline was likewise sued for an aggregate income tax liability amounting to Php132.51 million, inclusive of surcharges and interests.