Makati wants Smart to settle the P3.25 billion due to unpaid franchise taxes

Photo from Abante

Makati Mayor Abby Binay recently scored against billionaire Manny Pangilinan of Smart Communications Inc. after the Court of Tax Appeals (CTA) denied the petition of Smart assailing the June and August 2019 resolutions of presiding Judge Augusto Jose Y. Arreza, Branch 133 of the Regional Trial Court of Makati City.

The said resolution compelled Smart to open its books to the city’s tax men, including all revenues generated nationwide.

According to Bilyonaryo website, Binay wanted Pangilinan to settle the P3.25 billion due to unpaid franchise taxes of Smart.

“After careful review of the petition and arguments presented by both parties, this Court finds no grave abuse of discretion on the part of the public respondent and/or the RTC. The Court does not perceive any injury of such magnitude if the assailed resolutions are allowed to stand.” The 13-page decision penned by Associate Justice Jean Marie Bacorro-Villena said.

Meanwhile, PLDT-Smart’s legal team countered that the act was “improper” and is as good as giving the city government of Makati to a second audit (referring to its franchise tax payments for the years 2012 to 2015).

Makati also said that Smart did not give a breakdown of its gross sales and receipts of its branches and it cited that these documents were not confidential in nature.

The CTA also said that production of needed documents will not expose Smart to a re-audit of Makati government.

“The relevancy found by the lower court to warrant the production of the subject documents are only for the purposes of discovery. The actual relevancy of a piece of evidence or its relevancy for the purpose of admissibility is, however, a wholly different matter.”

“Relevancy of the latter kind can only be determined after the court has been given an opportunity to appreciate the evidence presented before it. At this juncture, it is impossible either for this Court or the lower court to determine the materiality of the subject documents prior to their production,” it said.

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