Pacquiao to fight tax evasion allegations against him

By Bev Llorente, ABS-CBN North America Bureau

Nov. 27, 2013

LAS VEGAS – $54 million — this is how much Philippine authorities said the Manny Pacquiao, the Filipino boxing champ, owes the Philippine government in unpaid taxes in 2008 and 2009, when he was at the peak of his career and one of the world’s highest paid athletes.

Just days after his heroic return to his home country following his win against Brandon Rios in Macau, China, Pacquiao showed a copy of his U.S. non-resident alien income tax return and documents sent by his accountants from the U.S., reportedly proving he paid his taxes.

He admitted they were only copies of the original. “That’s why it includes a letter from Bob Arum (his promoter/Top Rank CEO), so they will believe that the documents are authentic,” Pacquiao pointed out.

But tax authorities in the Philippines said if Pacquiao fails to pay what he reportedly owes, they could end up seizing his properties.

“Normally, we give them time to come up with the money before we start the next step, which is auctioning and bidding it out,” Kim Jacinto-Henares, Philippine BIR commissioner said.

Philippine tax officials said they’re leaving it up to the court to make a decision on Pacquiao’s case, even if the boxing star manages to provide them with the necessary documents from the IRS.

The Pacman said he’s ready to defend himself and his hard-earned wealth.

In Las Vegas, Nevada, Nadia Jurani, a certified public accountant and attorney-at-law said Pacquiao’s tax troubles should have been taken care of his by accountant and legal counsel in the U.S.

“Whoever is helping him is not doing a good job,” she said.

Before the Pacman’s latest bout in Macau, his previous winnings and earnings from boxing and other product endorsements took place in the U.S. Therefore, Jurani said, taxes were paid in America, as the U.S. government immediately withholds 35% to 40% of his net income for each transaction.

Jurani said Pacquiao should go back to his accountant and get the actual copy of his transcript.

Only the taxpayer himself can secure the release of his tax forms from the IRS, the 1040NR form, which is the tax form for non-resident aliens in the U.S.

“In the United States, if he paid taxes, he should be able to produce that tax return form 1040NR to take to the Philippines, to show that he paid taxes. The problem now is that the BIR in the Philippines doesn’t accept the transcript from the IRS, because the transcript doesn’t look like the real tax return,” Jurani pointed out.

She added that Pacquiao’s accountant or lawyer could go to the IRS and get an actual copy of the tax returns that were prepared that indicated how much taxes were paid. “The taxes he paid would be credited to whatever tax he would pay in the Philippines. So he will not be charged of double taxation,” Jurani stated.

She added that in the U.S., taxpayers are given ample time to fix their tax payments so garnishments and bank levies en masse would be avoided.

Balitang America tried to get a statement from Pacquiao’s promoter, Top Rank, but its offices are closed for the rest for the rest of the week due to the Thanksgiving holiday.

With a report from Francis Canlas.