Megaworld Corp. still under audit – BIR

MEGAWORLD Corp. remains under tax audit despite the deferral of its closure order, the Bureau of Internal Revenue (BIR) announced on Friday.

BIR Regional Director Eduardo Pagulayan Jr. said in a statement that the BIR Revenue Region 8B-South National Capital Region’s probe into Megaworld covers the verification of taxes on One-Time Transactions (ONETT) on the firm’s property sales and transfers.

“At first instance, Megaworld refused to comply with the BIR audit. The BIR Regional Office, however, found that the said corporation failed in its compliance and reportorial requirements under the Tax Code,” he added, noting that failure to meet these obligations constitutes grounds for closure.

“Last Wednesday, it was resolved that Megaworld will now comply with the audit. Hence, closure was set aside. However, the investigation is ongoing,” Pagulayan said.

It should be recalled that the tax office caused a stir on Tuesday, May 17, when it said in an advisory that Megaworld would be closed the next day.

Just hours after the announcement came, however, the BIR reversed course and said that the closure order is being “held in abeyance until further notice,” claiming that Megaworld had shown full cooperation.

The real estate company, for its part, admitted that it had questioned BIR Revenue Region 8B’s jurisdiction in conducting a tax audit on its pieces of property because it is regularly audited by the BIR head office’s Large Taxpayers Service (LTS).

In the meantime, Pagulayan said in the statement that BIR Revenue Region 8B expresses its belief that it has authority over such enforcement activity. He said this is supported by a Revenue Special Order from the Commissioner of Internal Revenue.

“Although Megaworld is considered a large taxpayer under the jurisdiction of the Large Taxpayers Service, BIR National Office, ONETT falls under the jurisdiction of the BIR Regional Offices since the situs of taxation of sale, transfer, and other disposition of real properties is where the property is located,” he explained.

Pagulayan further said the pieces of property under inquiry are located within Taguig City, which plainly falls under the jurisdiction of the BIR Regional Office and not the LTS.