MANILA, Philippines — Smart Communications Inc. said on Wednesday the company handed over documents to the Makati City government, two days after the local government padlocked the company's main office.
In a statement, the wireless unit of telco giant PLDT Inc. said they complied with Makati City’s directive a day after the shutdown of its offices within the city. The city government had said Smart owed the city P3.2 billion in taxes and operated without a business permit since 2019.
READ: Makati orders closure of Smart HQ over lack of permit, unpaid taxes
“The submission of the documents is part of ongoing discussions between the company and the Makati City LGU who both aim to arrive at a resolution to the matter at hand,” the statement read.
“Smart remains committed to complying with Makati City’s local tax ordinances, and with relevant national laws, applicable in respect of local taxation,” it added.
Smart's tax woes come months after its parent firm grappled with a P48-billion budget overspending that triggered a brutal sell-off of the company's stocks last December.
READ: PLDT to reduce capex in 2023 as it tackles overspending
In an e-mailed commentary to journalists, CreditSights, a financial research company under the Fitch Group, said the closure order against Smart "will likely cloud investor perceptions of the company, although we anticipate a limited impact on PLDT’s actual operations and financials."
"There has been little precedence of large corporates being shut down due to unpaid franchise taxes, and we believe PLDT will prioritize resolving the issue promptly," CreditSights said.
"We expect all services to remain operational in spite of the physical padlocking of the HQ... We believe the quantum of unpaid taxes is manageable considering PLDT's stable credit fundamentals," it added.
Shares in PLDT finished trading on Wednesday up by 2.57% at P1,318 apiece.