The Bureau of Internal Revenue is pushing for the inclusion of tax evasion on the list of crimes punishable under the anti-money laundering law, an amendment which is pending in the Senate.
Passed in 2001 after the Paris-based inter-government body Financial Action Task Force (FATF) put the Philippines on the |blacklist of money-laundering havens, the current law lists crimes such as kidnapping for ransom, plunder and drug trafficking.
The government can seek the freezing of assets of parties who are accused of crimes on the list.
The inclusion of tax crimes on the list is in line with the present trend among national governments and international organizations, the BIR said in a position paper submitted to the Senate sub-committee on anti-money laundering.
The BIR was referring to the drive against illegal movement of capital, which is seen as part of efforts to support and sustain economic development in low-income countries.
Further, the BIR said the Washington DC-based Task Force on Financial Integrity and Economic Development (FIED) has recommended to the FATF that tax crimes be included on the list of money-laundering crimes.
According to the Task Force on FIED—a consortium of governments, research and advocacy organizations—tax evasion is a crime committed by both individuals and corporate entities and the proceeds of the crime are the funds that should have been paid to a local or national government.
“Tax evasion is essentially present in the first stage of the money-laundering process for the reason that individuals involved in illegal enterprises are necessarily engaged in tax |evasion,” the BIR said. “(T)heir true personal income from illegal activities (is) closely
intertwined with tax evasion.”
The BIR is also recommending that, aside from the inclusion of tax evasion on the list of money-laundering crimes, those facing money-laundering charges should be automatically prosecuted for tax evasion as well.