ASEAN KEY DESTINATIONS
“Friendly” Philippine banks targeted
The Philippine government will go after bank managers who had allowed relatives of decedent depositors to withdraw their funds to avoid payment of estate tax, according to the Department of Finance (DOF).
Finance Secretary Cesar Purisima said the agency already secured an affirmative opinion from the Department of Justice (DOJ), clearing the way for the pursuit of bank managers who consented or even offered the withdrawal by forced heirs of the money from their decedents’ bank accounts.
“The [DOJ] finally gave its affirmative legal opinion on the matter, and thus we are now pursuing [action] against those bankers who have facilitated the withdrawal of decedents’ funds without them paying estate tax,” Purisima said.
“Our collection of estate taxes is so low because all these branch managers allow the family to withdraw the money on the day of the death of the clients. It’s part of their service,” he added. The finance chief said that tax evasion cannot happen without the participation of those in the private sector, adding that, “So if you know someone, even if you are the one that benefited, tell us, so that we can run after these branch managers.”
Under the law, succession takes place at the time of death of the decedent. Succession is defined as a legal mode by which such property, whether personal or real, rights and obligations are transmitted to the compulsory and instituted heirs.
Surviving heirs shall be liable for the payment of estate tax depending on the amount or value of their respective inheritance.
Purisima said that bank managers who will be found conniving with the families or heirs of the decedents may be held liable as accomplices, while the heirs will be prosecuted as principals.
“Estate tax is one of the loopholes that we need to plug in order to improve our revenue collections, and hence, we will pursue criminal cases against bankers who are involved in this particular mode of avoiding payment of tax, which is essentially due to government,” Purisima said.
The Bureau of Internal Revenue, which collects the estate tax, is required to raise P920 billion to finance the government’s P1.645 trillion budget.
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