THE Supreme Court has ruled that the collection of a taxpayer’s civil liability for unpaid taxes in a criminal prosecution does not require a prior assessment for deficiency taxes.
This decision came as the SC denied celebrity doctor Joel C. Mendez’s petition and partly granted the Office of the Solicitor General’s (OSG) petition for review.
Mendez was charged in 2006 for violating the National Internal Revenue Code.
The Court of Tax Appeals (CTA) found him guilty but held that a final assessment by the Commissioner of Internal Revenue is necessary for civil liability.
In resolving the issue, the SC denied Mendez’s petition for review and affirmed his conviction, finding his contentions a mere rehash of the arguments which were raised and already considered by the CTA.
On the other hand, the OSG’s petition was partly granted by the SC, ruling that the CTA had jurisdiction over Mendez’s cases since his potential liability in each are more than PhP1,000,000, in accordance with Republic Act No. (RA) 9282.
The SC also laid down guidelines, stating that in criminal tax cases, a prior assessment is not required for collection. The government must prove guilt and civil liability without solely relying on an assessment.
Regarding Mendez’s civil liability, the SC outlined guidelines for the prosecution of criminal tax law violations and corresponding civil liability, stressing that a criminal action serves as a collection case.
If a civil action is filed before the criminal case, it may be consolidated, and the judgment in the criminal action includes the accused’s liability for unpaid taxes.
