The Bureau of Internal Revenue (BIR) today filed a criminal complaint with the Department of Justice against JANET LIM NAPOLES (JANET NAPOLES)and her spouse JAIME GARCIA NAPOLES (JAIME NAPOLES) for violating pertinent provisions of the National Internal Revenue Code of 1997, as amended (Tax Code).
Spouses JANET and JAIME were charged with willful attempt to evade or defeat tax for taxable years 2004, 2006, 2008, 2009, 2010, 2011 and 2012 under Sections 51 (A)(1)(a) and 74 in relation to Section 254 of the Tax Code.
In addition, JANET NAPOLES was charged with deliberate failure to supply correct and accurate information in her Income Tax Return (ITR) for taxable years 2004, 2006, 2008, and 2009 and with willful failure to file her ITRs for taxable years 2010, 2011 and 2012.
JAIME NAPOLES was likewise charged with deliberate failure to supply correct and accurate information in his ITR for taxable year 2009 and with willful failure to file his ITRs for taxable years 2004, 2006, 2008, 2010, 2011 and 2012 proscribed under Section 255 of the Tax Code.
Spouses Napoles are both registered taxpayers of the BIR with addresses at Suite 2502 Discovery Centre, 25 ADB Avenue, Ortigas Center, Brgy. San Antonio, Pasig City and at San Isidro St., Ayala Alabang Village, Muntinlupa City. The registration of JANET NAPOLES was, however, cancelled in 2010.
Information gathered during investigation disclosed that Spouses NAPOLES during the years 2004 to 2012 were able to purchase and register in their names various real properties, a number of motor vehicles, several insurance policies and club shares. They also invested millions of pesos in various new corporations. The acquisitions consisted of condominium units in City & Land Mega Plaza and the Discovery Center, parcels of land in Pangasinan and Kidapawan City, Insurance policies with Insular Life Assurance Co., Ltd., Philippine American Life & General Insurance Co., Inc., and Philippine Axa Life Insurance Corp., and vehicles such as Ford Lincoln Navigator, Honda Civic and Porsche Cayenne.
JANET NAPOLES’ total acquisitions amounted to
P4.17 million in 2004, P22.29 million in 2006, P4.35 million in 2008, P9.84 million in 2009, P6.33 million in 2010, P5.64 million in 2011 and P6.89 million in 2012. She declared as income in her ITR P195,800.00 in 2004, P0.00 in 2006, P100,744.59 in 2008 and P0.00 in 2009. She did not file any ITR for the years 2010, 2011 and 2012.
On the other hand, JAIME NAPOLES’ total acquisitions amounted to
P1.42 million in 2004, P5.51 million in 2006, P0.78 million in 2008, P9.25 million in 2009, P2.1 million in 2010, P1.17 million in 2011 and P3.65 million in 2012. He failed to file any ITR for the said years except in taxable year 2009 where he declared nothing.
Using the Expenditure Method of Investigation, the total income tax liability of JANET NAPOLES was
P44.68 million, inclusive of surcharges and interests, broken down into: P3.49 million in 2004, P19.77 million in 2006, P3.18 million in 2008, P7.74 million in 2009, P3.93 million in 2010, P3.14 million in 2011 and P3.42 million in 2012.
JAIME NAPOLES was assessed a total income tax liability amounting to
P16.43 million, inclusive of surcharges and interests, broken down into: P0.83 million in 2004, P4.78 million in 2006, P0.45 million in 2008, P6.33 million in 2009, P1.52 million in 2010, P0.77 million in 2011 and P1.75 million in 2012.
The Expenditure Method of tax investigation is based on the theory that if the subject taxpayer’s expenditures during a given year exceed his reported income, and the source of the funds used to make the expenditures is unexplained, such expenditures represent unreported income.
The case against JANET LIM NAPOLES and her spouse JAIME GARCIA NAPOLES is the 190th filed under the RATE program of the BIR under the leadership of Commissioner Kim S. Jacinto-Henares.