COA bloated Genuino’s compensation by P283M



THE Bureau of Internal Revenue collects from the biggest earners P125,000 for the first P500,000 “plus 32 percent of the excess over P500,000 and onward.” If it strictly adheres to this formula without any exception, this administration can easily increase tax collections to support its various programs for the poorest of the poor, who were totally neglected by the previous leadership.

Despite this formula, I could not accurately compute the income tax payments of certain taxpayers because only the amount of tax payments is given in BIR’s list of top 500 taxpayers. The taxable income is unknown.

Instead of the BIR’s suggested computation, I formed an equation in which letter x stands for the unknown or missing number. Getting 31.965 percent of the resulting equivalent of x, I arrived at the taxable income of the man in this piece: Manuel V. Pangilinan (MVP).

If MVP is indeed the Philippines’ highest-paid executives as he is perceived to be, he should be at the top of BIR’s list of top 500 taxpayers. He is not. BIR’s reports posted on showed MVP is only one of the top 500 taxpayers but has never been No. 1.

Not the highest taxpayer
My estimate may prove unfair to MVP because I might end up either reducing or increasing his taxable income. Despite this apprehension, I believe he will remain one of the Philippines’ biggest taxpayers as he has been from 2012 to 2014.

In a three-year period, MVP paid a total of P83,398,395 in income tax. He paid P27,090,368 in 2012 that ranked him No. 45.. He was No. 27 in 2013 on his payment of P31,636,324, and No. 30 in 2012 on income tax of P24,671,703.

My computations showed BIR’s basis for MVP’s income taxes was his total earnings of P260,905,349 distributed by year as follows: P84,750,095 in 2014; P98,971,763 in 2013; and P77,183,491 in 2012.

Incidentally, as chairman of Metro Pacific Investments Corp. (MPIC), MVP is among the company’s five highest-paid executives. As a group, he and four others received total compensation of P205.58 million in 2014; and P184,959,132 in 2015. This year, MPIC estimated the group’s pays and perks at P469,466,535.

Bloated pays and perks
If MVP was in BIR’s top ranking, how come Efraim Genuino, former chairman of the government-owned Philippine Amusement and Gaming Corp. (Pagcor), was not in the league? After all, Malacañang has attributed to him unimaginable compensation that should not have been easy for BIR to ignore.

In 2009, the Commission on Audit during the administration of President Gloria Macapagal-Arroyo, credited Genuino with total compensation of P3,714,816 of which P952,032.48 was his basic annual salary. In addition, he received other payments such as per diem, P370,000; representation and transportation allowance, P1.32 million. His much smaller amount of incentive was P33,000.

Note Genuino’s gross remuneration in 2009 and compare it with what he was supposed to have been paid for six months as Pagcor chairman in 2010. COA, particularly Heidi Mendoza as officer-in-charge, claimed Genuino received a total of P287,457,717. With this amount of basic salary and incentives, he would have topped the list of taxpayers in 2010.

Genuino’s P91.9M tax?
I don’t know if Genuino did make it to BIR’s top ranking of taxpayers. There is no way I could verify this because BIR’s earliest report was for 2012. Neither did I find among BIR’s files any news that the previous administration went after him and crucified him for non-payment of taxes.

How Genuino ended up with total compensation of close to P300 million is something to ponder about.

In COA’s own website, I discovered why Genuino’s annual compensation surged to P287,457,717.27 in 2010 from only P3,714,816 in 2009. The main culprit was COA’s insertion of “confidential/intelligence fund” as part of the Pagcor chief’s yearly compensation.

If he did not pay the required amount of taxes on his huge income, BIR should have sued Genuino for either tax evasion or reduction. My computation showed BIR should have levied him P91,951,469.

Of course, BIR chief Kim Henares did not run after Genuino. Had she done so, she would have to include in her investigation Cristino Naguiat, a presidential appointee like her, who eventually succeeded Genuino.

Naguiat too
Because Genuino served only for six months in 2010, his total annual compensation of P287,457,717 translates to P47,909,619.50 a month. His successor’s P69,185,374 was equivalent to P11,530,895 a month.

Pagcor divided Naguiat’s six-month compensation into basic salary of P476,016.24, or P79,336.04 a month; allowance of P909,000, or P151,500 a month; bonus, incentives and benefits, P1,229,025 or P204,837.50. In addition, he was paid an additional perk of P8,950.68.

The two Pagcor chiefs’ compensation got bloated in 2010 because of COA’s insertion of “confidential/intelligence fund” as additional perk: P283,254,410 for Genuino and P66,255,729 for Naguiat.

Why did COA define confidential/intelligence fund as compensation only in 2010 but not in 2009? How come the government auditors suddenly changed their definition of compensation by including “confidential/intelligence fund” as part of compensation only for the year 2010? Why did they pick 2010? Just asking.


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1 Comment

  1. Mariano Patalinjug on

    Yonkers,New York
    18 July 2016

    Call it what others may, but the total remuneration [salary plus perks] which PAGCOR chief Genuno got as revealed here for each of those years, amounts to LEGAL EMBEZZLEMENT!

    Why, oh, why, should the head of PAGCOR be entitled to such an unjustifiable annual remuneration? His annual “take” is several times the salary of the President of the Philippines!

    Aside from being “legal embezzlement,” it is also “legal corruption!”

    I smell something “fishy” here–and the President and the Congress had better do something to stop this pronto.