The Department of Justice on Sunday defended its resolution recommending the indictment of Rappler Holdings Corp. and its top executives for alleged evasion of taxes worth P108.4 million.
Justice Secretary Menardo Guevarra debunked the allegation of RHC that the tax evasion case filed before the Court of Tax Appeals last week was “a clear form of continuing intimidation and harassment” against the holding firm’s online news outfit, Rappler, because of its critical reports on the Duterte administration.
Guevarra said the filing of charges against Rappler was not “an attempt to silence journalists” because the complaint filed by the Bureau of Internal Revenue was resolved based on records, evidence and answers submitted by the respondents.
“No one, and absolutely no one, much less from Malacañang, has interfered with state prosecutors in the resolution of the Rappler tax evasion case,” Guevarra said in a statement.
“The duty of state prosecutors is to determine the existence of probable cause only, and they have found the evidence and arguments of the BIR sufficient and cogent enough to establish a probable violation of our tax laws,” he added.
Guevarra said the administration does not resort to harassment of media outfits that are critical of President Rodrigo Duterte because it respects the freedom of the press.
“The government has always respected press freedom and tolerated all unfounded criticisms against it, including cries of alleged harassment, even when there is none,” he said.
The DOJ chief said Rappler should just answer the case, which is now with the CTA, adding that the holding firm still “has all the legal remedies at its disposal.”
Rappler earlier claimed the tax evasion case did not come as a surprise “considering how the Duterte administration has been treating Rappler for its independent and fearless reporting.”
Rappler’s lawyer Francis Lim likewise said the media outfit’s denial of the tax evasion charges.
“Let me reiterate that Rappler Holdings has not evaded the payment of any tax obligations in relation to its sale of Philippine Depositary Receipts (PDRs) to two foreign entities in 2015,” he said.
Lim further warned the filing of the case against RHC “will have a chilling effect on those who have raised and will raise capital through the issuance of PDRs and is a blow to the development of our already laggard capital markets.”
The BIR alleged in its complaint last March that RHC did not pay P133 million in income and value added taxes over the sale of P181.67 million worth of PDRs to Omidyar Network Find LLC and NBM Rappler LP.
RHC allegedly gained P162.5 million from the transaction, which it failed to disclose in its tax return.
But while the DOJ found basis in the complaint, it lowered the liability of RHC to P108,458,948.67 in taxes with interest and surcharge.
The DOJ said RHC acted as a middleman in buying Rappler Inc.’s shares for the purpose of underwriting PDRs for resale to interested buyers.
RHC purchased around 119 million common shares from Rappler Inc. from 2014 to 2015, and against these shares, issued PDRs to NBM Rappler and Omidyar.