Government to appeal Tan case

The government said yesterday it would appeal its P25-billion case against beer and tobacco magnate Lucio Tan and is considering the possibility of filing a civil case while appealing for certiorari before the Court of Appeals.

Finance Secretary Margarito Teves told reporters yesterday that the government is still mulling over its options but it would definitely appeal the ruling on the tax evasion case against Tan.

The government has been trying to pin down Tan for his alleged tax arrears now reportedly running close to P25 billion, with accounts dating back to the administration of the deposed President Ferdinand Marcos.

A Marikina court dismissed the charges against Tan’s Fortune Tobacco Corp. and its executives for non-payment of the correct amount of taxes on cigarettes from 1990 to 1992.

"We are looking at our legal options," Teves said. "But we could file a civil case and may file a certiorari motion for possible abuse of discretion on the part of the regional trial judge."

The decision was penned by presiding judge Alex Ruiz, who said the government failed to prove that Fortune owned shares of stocks in what the government said were dummy corporations.

Tan’s Fortune Tobacco allegedly created nine dummy corporations to act as buyers of cigarette products manufactured by the company to simulate low prices.

By employing these dummy corporations, Fortune and the nine other companies allegedly evaded paying value-added and ad valorem taxes from 1990 to 1992.

The tax evasion case was originally filed in 1993 by the Bureau of Internal Revenue (BIR) when Liwayway Vinzons-Chato was internal revenue commissioner.