Oil firms urged to pay P150 B in back taxes

Tax deficiencies of the country’s top oil firms incurred years back are big enough to wipe out the contry’s budget deficit, former Speaker Manny Villar said yesterday as he urged them to settle their obligations with government.

"This money can be used to fund priority projects such as mass housing and livelihood programs," said Villar of the said tax deficiencies that are estimated to reach at least P150 billion including interest, penalties and surcharges which remain uncollected.

This is according to data submitted by the Philippine Consumers Foundation Inc. from 1996-1997 supported by official ERB reports on all phases of production, sales, and payments of P43 billion in basic income and specific taxes.

As a result, the Executive Department has asked the help of the Department of Finance to make a preliminary assessment of the so-called big three, namely Petron, Caltex and Shell. In a letter dated March 15, 2001, Senior Deputy Executive Secretary Waldo Flores asked the help of the DOF in investigating the oil firms.

"It seems that the big three have not only milked consumers but have also not been paying the right taxes and cheating government and the Filipino people," said Villar.

The PCFI documents noted that based on their computation, instead of paying an income tax of P1.7 billion in 1990, Petron, paid only P29.1 milion or a tax deficiency of P1 billion.

Shell paid only P245 million instead of P881 million. Caltex meanwhile had total tax deficiencies amoutning to P4 billion for the said ear alone.

Villar said that the deficiency involves "very large amounts" which if paid out can address many pressing needs of Filipinos.

"This must be thoroughly investigated and scrutinized with the objective of making these companies pay what they owe to the government," stressed Villar.