By VERA Files
FORMER First Son and incumbent party-list congressman Juan Miguel “Mikey” Arroyo and his wife Angela Montenegro will be charged with tax evasion, after the Department of Justice found probable cause to sue them.
The DOJ’s Task Force on Bureau of Internal Revenue Case (TBFBIR) released a resolution today saying it has found probable cause to charge Mikey and Angela with multiple counts of violation of Section 255 of the National Internal Revenue Code.
The resolution was the DOJ’s response to the complaint the BIR filed in April 2011, which alleged that the couple underdeclared their income for the years 2004, 2006, and 2007.
Angela allegedly failed to file income tax returns from 2003 to 2009, and Mikey for the years 2005, 2008 and 2009.
Mikey, eldest son of former president Gloria Macapagal Arroyo, served as governor of Pampanga from 2001 to 2004, before becoming representative of its second district from 2004 to 2010. He is currently “Ang Galing” party congressman representing security guards.
In its investigation, the BIR found the Arroyos to have been deficient in paying some P73 million in taxes, of which P58.6 million was for the year 2004.
The BIR found that the Arroyo couple’s Statement of Assets, Liabilities and Net Worth (SALN) from 2004 to 2009 had grown considerably, the proof being the real estate and other personal property they had accumulated.
Among these is the house in 1655 Beach Park Blvd in Foster City, San Mateo County in California worth $1.32 million which was registered in Angela’s name but did not appear in Mikey’s SALN.
In August 2009, VERA Files broke the story that Mikey had failed to declare this property in his SALN, and that he had put in on the market for sale.
Two years later in April 2011, VERA Files also reported that Mikey’s firm, Beachway LLC, had managed to sell the property for $1.25 million to Mary Grace Apolinario and Jerome Ngo, owners of the popular restaurant chain “Gerry’s Grill,” who are said to be good friends of Mikey.
A DOJ statement said, “Using the Net Worth Method (“NWM”) of tax investigation, which compared the difference between the increase in their net worth and their reported taxable income for the same period, it was determined that there has been underdeclaration of the total amount of income by more than 30%, which constitutes prima facie evidence of the employment of a fraudulent scheme to defeat payment of taxes.”
Arroyo told BIR investigators the increase in his income came from the interest income that was already taxed, income exempt from tax such as 13th month pay, gifts from relatives, and errors in the declaration of their SALN for 2002.
