THE Supreme Court has ordered the Bureau of Internal Revenue (BIR) to refund to Lucio Tan more than P355 million in taxes it collected from him in 2002.
In a ruling penned by Associate Justice Presbitero Velasco Jr., the Court’s third division ordered the Court of Tax Appeals (CTA) to issue a writ of execution directing the Commissioner of Internal Revenue to refund P355,385,920 to Tan’s company, Fortune Tobacco Corporation (FTC).
The Court ruling sets aside the decision of the CTA en banc dated March 12, 2010 and the resolution dated June 11, 2010 in CTA EB No. 530 as well as the resolutions dated June 4, 2009 and August 10, 2009 which denied the Motion for Issuance of Additional Writ of Execution of the CTA First Division in CTA Cases Nos. 6365, 6383, and 6612d.
Concurring with the decision were Associate Justices Diosdado Peralta, Roberto Abad, Jose Catral Mendoza, and Marvic Leonen.
In 2000, the Finance department raised by 12 percent the tax for machine-packed cigarettes. FTC filed a petition for the refund of overpaid excise tax from January 1, 2002 to December 31, 2002.
“If the BIR, or other government taxing agencies expect taxpayers to observe fairness, honesty, transparency, and accountability in paying their taxes, it must hold itself against the same standard in refunding excess payments or illegal exactions,” the Court said.
In 2011, the Supreme Court also ordered the BIR to return P491 million in taxes it collected in 2003 and 2004 from FTC after the court affirmed the CTA’s 2007 decision that granted Fortune Tobacco a tax refund.
Fortune Tobacco produces Champion M, Salem M, Salem M King, Camel F King, Camel Lights Box 20’s, Camel Filters Box 20’s, Winston F King, and Winston Lights.