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BIR files tax evasion case vs gold trader

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The Bureau of Internal Revenue collected P71 billion in September, falling short of its monthly target for the third month in a row.

MANILA, Philippines — The Bureau of Internal Revenue (BIR) filed a tax evasion case, on Thursday, against a gold trader who under-declared his income from 2006-2009, the period where he sold gold and silver to the Bangko Sentral ng Pilipinas (BSP) worth P872.68 million.

According to Internal Revenue Commissioner Kim Henares, Francois Joseph Xavier Rast, owner of the Rast Metalor Phils, owes the government P558.03 million for taxable years 2006 to 2009.

Rast was found to have not declared all his income for that period. He “grossly underdeclared” his income by more than 30 percent or P775.07 million, upon comparing the gross income he declared in his tax returns with the payment he received from BSP in that period.

Henares said BSP documents showed that Rast sold gold and silver amounting to P872.62 million to BSP.


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Tags: Bureau of Internal Revenue , crime , Francois Joseph Xavier Rast , gold traders , Kim Henares , law and justice , News , tax evasion

  • ceejay2420

    The numbers quoted in this report indeed do not add up. It seems to appear therefore  that BIR has no case against this guy or the writer missed to include the more important numbers pertaining this case.

    But I must also mention that gold and silver smuggling is rampant especially those precious metals that came from small mining operations. Because of the sales tax imposed on sellers and low price paid by Bangko Sentral, a big number of miners and traders engaged in gold business in Mt. Diwata, Paracale and other sites, are encouraged to resell their metals to Chinese brokers instead who pay much higher prices and do not collect sales tax . These transactions are generally held behind closed doors and reported to involve more than 80% of what was actually mined. The gold acquired by the brokers are then later smuggled to China via Hongkong.While report is centered on income tax, I suspect this trader could be one of those either selling or buying gold that find their way to Hongkong evading payment of sales tax in the process . He is being pursued by the BIR to give warning to others only the reporter wasn’t more complete and diligent in his reporting. The government loses so much tax revenues from these smugglers- revenues that would have rather been available to finance building of more schools, hospitals and roads for our people living close to or around the mining sites. 

  • http://pulse.yahoo.com/_CKBW2BZX34JXQUSVAMZVKCLNAU TagaDumantay

    He sold gold and silver to BSP worth P837 million. BIR claims he owns P558 million. How could it be? Does it means he never used capital money to buy these golds to miners? Assuming he managed to bought at half his selling price which is is unlikely, then taxable income is only P 400 million +. So how much is due for P400 million income?

  • kismaytami

    Di kaya ito mabasura sa korte?

  • http://twitter.com/Borogol Borogol

    lalo lang nito itataboy yung mga nag bebenta ng gold sa BSP…

    well, people should never forget…. Kim Henares..

    • latino_boom

      So you mean to say just glorify the wrong things that they are doing? Keep on shortchanging the Gov’t…is that what you are trying to imply? Yeah I remember Kim Henares she is just doing her job

  • http://www.facebook.com/people/Klein-Mo/1764894963 Klein Mo

    Ang gulo ng report… The numbers don’t add up. His supposed income is P872.62 million according to BSP. The reporter also said that he under-declared his income by 30% – which I think means that he only declared P610.834 million (70% of  P872.62 million). Now, what is P775.07 million?? 

    If he declared only P610.834 million as his income, that translates to P195.5 million in taxes (32% tax rate * P610.834 million) and his arrears would be equal to P83.8 million (30% of P872.62 million * 32% tax rate) – excluding penalties of course. Now how did BIR arrive at P558.03 million as cited by the report?

    – My guess is that the reporter jumbled the numbers without really checking if they make sense. Basta lang maksulat… Editors where are you??

    Case 1: if the calculation of the reporter is correct that 30 percent of his income is P775.07 million (portion not declared), then his supposed income would be 2.583 billion. Prob is, if this is correct, then his remaining tax obligation is only P248 million (32% tax rate applied on P775.07 million)

    Case 2: if the reporter correctly quoted BIR’s estimate of his tax obligation which is P558.03 million, then his supposed income should be P5.8128 billion (not P872.62 million), assuming that the P558.03 million is based on the 30% income under-declaration – meaning that the income he did not declare is about P1.7438 billion (30% of P5.8128 billion) — taking 32% of this amount gives you P558.03 million.

    • im_earth

      ito naintidihan ko:

      (70% declared income + 30%+ undeclared income) x 32% tax rate* => tax amount
      (P872.68 + P775.07 million) x 32% tax rate => tax amount
      P 1,647.75 billion1 x 32% tax rate => tax amount
      P 527.28 million => tax amount

      tax amount above is closer to this statement:
      “owes the government P558.03 million for taxable years 2006 to 2009.”

      and im not sure about the tax rate for gold and silver :-)
      (cross finger)
      magulo nga. (_^)

      • latino_boom

        Nice to see people who are using their brains rather than looking for faults…nice job mate

      • Ronilo Yap

        Yon oh.. closer. ang percentage nalang ng tax ang di sure dyan baka iba ang tax ng ganyan negosyo. Yong iba kasi basta maka comment lang. Gusto ko maniwala kaagad pero nang makita ko to ok naman pala.

    • southbound

      oo nga ang gulo ng report.  furthermore, only the net income (revenue less expenses) is taxable by 30%, not the whole revenue.  of course meron expenses yung manufacturer  or trader ng gold na dapat i-consider sa tax computation.

  • CheapJ

    You can run, but you can’t hide. Good job Commissioner Henares! Hopefully, there will be conviction against these tax evaders although our judiciary is still the weakest link. Judiciary should step up in helping the much-needed reforms. 

    • http://twitter.com/Borogol Borogol

      …paano yung over tax na paniningil nila?

      • latino_boom

        Have you ever heard the word ” TAX REBATE’ if you haven’t heard nor encounter that word it means you are not paying your tax properly or you are not paying at all…coz i always got mine…i dunno with you



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