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TOPIC COVERAGE: promptly to assess has no connections with the

 Criminal Action and their penalties commission of the crime.
 Willful Blindness Doctrine  Note however that for criminal prosecution to
 Prescription in Criminal Cases proceed before assessment there must be a
 Informer’s Reward prima facie showing of a willful attempt to
 Crimes, other Offenses and Forfeitures evade taxes. If none, criminal case may not be
 Other Penal provisions filed without the computation and assessment in
 A criminal complaint is instituted not to demand WILLFUL BLINDNESS DOCTRINE
payment, but to penalize the taxpayer for  A taxpayer can no longer raise the defense that
violation of the Tax code. No criminal action for the errors on their tax returns are not their
the recovery of taxes shall be filed without the responsibility or that it is the fault of the
approval of the CIR. accountants they hired.
 The judgment in the criminal case shall not only  Intent to defraud need not be shown for a
impose the penalty, but shall also order the conviction of tax evasion. The only thing that
payment of the taxes subject of the criminal case needs to be proven is that the taxpayer was
as finally decided by the Commissioner. aware of his obligation to file the tax return but
 Acquittal of taxpayer in a criminal case does not he nevertheless voluntarily, knowingly and
exonerate him from tax liability. His legal duty intentionally failed to file returns.
to pay taxes cannot be affected by his attempt to  “WILLFUL BLINDNESS” is defined in Black’s Law
evade payment. Said obligation is not a Dictionary as “deliberate avoidance of
consequence of the felonies acts charged in the knowledge of a crime, especially by failing to
criminal proceeding, nor is it a mere civil liability make a reasonable inquiry about suspected
arising from a crime that could be wiped out by wrongdoing, despite being aware that it is highly
the judicial. probable.” A “WILLFUL ACT” is described as one
 Civil Liability to pay taxes arises from the fact done intentionally, knowingly and purposely,
that, for instance, one has engaged himself in without justifiable excuse.
business. His civil liability to pay taxes arises not  In the case of PEOPLE vs. KINTANAR (CTA EB No.
because of any felony but upon the taxpayer’s 006, Dec. 2010), Ms. Kintanar was charged with
failure to pay taxes. failure to make or file her income tax returns
 The Criminal liability arises upon failure of the (ITR), violating Section 255 of the 1997 NIRC, as
debtor to satisfy his civil obligation. amended. She claimed that she did not actively
 Computation and assessment of deficiency participate in the filing of her joint ITR with her
taxes is not a pre-requisite for criminal husband since she entrusted such duty to the
prosecution under the NIRC. Hence, protesting latter who, in turn, hired an accountant to
an assessment cannot stop criminal prosecution perform their tax responsibilities. She testified
under the NIRC. that she did not know how much her tax
 When fraudulent tax returns are involved, a obligation was; nor did she bother to inquire or
proceeding in court after the collection of such determine the facts surrounding the filing of her
tax may be begun even without assessment, as ITRs.
can be gleaned from section 222(A).  This case set a precedent that mere reliance on a
 A crime is complete when the violator has representative or agent (i.e., accountant or
knowingly and willfully filed a fraudulent husband) is not a valid ground to justify any
return, with intent to evade and defeat the tax. noncompliance in tax obligations. The taxpayer
The perpetration of the crime is grounded upon must inquire, check and validate whether or not
knowledge on the part of the taxpayer that he his/her representative or agent has complied
has made an inaccurate return, and the with the taxpayer’s tax responsibilities.
government’s failure to discover the error and
 However, in the case of PEOPLE vs. JUDY ANN possession of the BIR nor of public knowledge,
SANTOS (CTA CCNo.0-012, Jan. 2013), Ms. leading to the discovery of frauds upon NIRC,
Santos was accused of failure to supply correct resulting to the recovery of revenues and fees
and accurate information in her ITR. She claimed and/or conviction of the guilty party and/or
that by virtue of trust, respect and confidence, imposition of any fine or penalty.
she has entrusted her professional, financial and  EXCEPT:
tax responsibilities to her manager since she was  BIR official or any other incumbent public official
12 years old. She participated and maintained or employee;
her intention to settle the case, and thus  Relative within the 6th civil degree of
provided all the documents needed as well as consanguinity of a BIR official or employee, or
payment of her taxes. other public official or employee;
 Though already retired/ separated from service,
 The CTA Division acquitted Ms. Santos despite BIR officials or other public officers who acquired
having almost the same circumstances as that of the information in the course of their duties
the case of Ms. Kintanar. She participated and during their incumbency.
maintained her intention to settle the case, and
thus provided all the documents needed as well IMPORTANT PRINCIPLES IN CRIMINAL ACTIONS
as payment of her taxes. The element of  Assessment is not necessary before filing a
willfulness was not established and the CTA criminal action and criminal action may be filed
found her to be merely negligent. The CTA also during the pendency of an administrative protest
noted the intention of Ms. Santos to settle the in BIR.
case, which negates any motive to commit fraud.  Effect of acquittal does not result in the
This was affirmed by the SC in its resolution exoneration of said taxpayer for his civil liability
issued April 2013. to pay taxes.
 Any person convicted of a crime penalized by
NIRC shall in addition to the payment of tax, be
 The prescriptive period for criminal cases is five
subject to the penalties imposed therein.
years. When it begins to run depends in the
 The subsequent satisfaction of civil liability by
nature of the violation of the taxpayer:
payment or prescription does not extinguish the
 If failure or refusal to pay taxes due: from the
taxpayer’s criminal liability.
services of final notice and demand for payment
 In case of insolvency on the part of the taxpayer,
of the deficiency taxes upon the taxpayer.
subsidiary imprisonment cannot be imposed as
 If filing of false or fraudulent returns: from the
regards the tax which he is sentenced to pay.
discovery and institution of judicial proceedings
However, it may be imposed in cases of failure to
for its investigation and punishment.
pay the fine imposed (NIRC, Sec. 280)
 It would seem that cases of fraudulent/false
 Criminal action may be filed despite the lapse of
returns are practically IMPRESCRIPTIBLE for as
the period to file a civil action for collection of
long as the period from the discovery and
taxes. (NIRC, Sec. 281)
institution of judicial proceedings for its
 Filing of a criminal action is not an implied
investigation and punishment, up to the filing of
assessment by the CIR
the information in court does not exceed five
 No reservation to file civil action
 Assessment is still necessary even if the accused
is found guilty under Sec. 255 of NIRC (failure to
file tax return or to supply correct information)
 The law provides rewards for informers, or in
local parlance.
 any qualified person who voluntarily provides
definite and sworn information no yet in the