Another Malampaya Fund Infrastructure Projects Contractor charged with tax evasion

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The Bureau of Internal Revenue (BIR) today filed a criminal complaint with the Department of Justice against LORENZO BOTE LEONCIO (LEONCIO) for Willful Attempt to Evade or Defeat Tax, Deliberate Failure to Supply Correct and Accurate Information in his Income Tax Return (ITR) and 4th Quarter Value-Added Tax (VAT) Returnand Willful Failure to File his 1st, 2nd and 3rd Quarter VAT Returns for taxable year 2008, all in violation of Sections 254 and 255 of the National Internal Revenue Codeof 1997, as amended (Tax Code).

Respondent LEONCIO is the sole proprietor of LB LEONCIO TRADING AND CONSTRUCTION (LBLTC) and engaged in the business of construction, among other commercial pursuits, at Poblacion Narra, Palawan 5303.

LBLTC was contracted by the Provincial Government of Palawan (PGP) to construct several infrastructure projects funded by Malampaya Funds during taxable year 2008.

Investigation disclosed that LEONCIO declared in his ITR for taxable year 2008 gross revenues amounting to only P18.04 million.

Documents gathered by investigators, including checks issued by PGP, disbursement vouchers certified by the Commission on Audit (COA), and official receipts issued by LBLTC, however, showed that LEONCIO received income payments amounting to P86.13 million from PGP, P4.42 million from NIA and P1.27 million from the sale of rice for taxable year 2008. He was likewise found to have failed to file his 1st, 2nd and 3rd Quarter VAT Returns for the same taxable year.

The aforecited findings summed LEONCIO’s gross revenues per investigation for 2008 to P91.82 million. Compared to his gross revenue declaration in his 2008 ITR of only P18.04 million, he substantially underdeclared his income by P73.78 million or by 409%. He likewise underdeclared his VAT receipts for taxable year 2008 byP67.53 million, or by 1,195%, when investigators discovered he earned P73.18 million while declaring P5.65 million only in his VAT return.

As a consequence of his acts and omissions, LEONCIO was assessed an aggregate deficiency tax liability for taxable year 2008 in the amount of P78.65 million, inclusive of surcharges and interests, broken down as follows: Income Tax – P58.22 million; and VAT – P20.43 million.

The case against LORENZO BOTE LEONCIO is the 202nd filed under the Run After Tax Evaders (RATE) program of the BIR under the leadership of Commissioner Kim S. Jacinto-Henares.