Barcelona’s Messi sentenced to 21 months for tax fraud

BARCELONA — A court in Spain on Wednesday sentenced Barcelona striker Lionel Messi and his father to 21 months in jail for tax fraud and slapped them with a fine of 3.7 million euros ($4.1 million).

But these prison sentences are likely to be suspended as is common in Spain for first offences for non-violent crimes carrying a sentence of less than two years.

A court in Spain on Wednesday sentenced Barcelona striker Lionel Messi and his father to 21 months in jail for tax fraud and slapped them with a fine of 3.7 million euros ($4.1 million).

But these prison sentences are likely to be suspended as is common in Spain for first offences for non-violent crimes carrying a sentence of less than two years.

The Argentina and Barcelona star and his father Jorge Horacio Messi were found guilty of using companies in Belize and Uruguay to avoid paying taxes on 4.16 million euros of Messi’s income earned from his image rights from 2007-09.

The income related to Messi’s image rights that was allegedly hidden includes endorsement deals with Banco Sabadell, Danone, Adidas, Pepsi-Cola, Procter & Gamble and the Kuwait Food Company.

source: sports.inquirer.net

Too early to talk of tax amnesty for Pacquiao

MANILA, Philippines—The possibility of extending amnesty to world boxing champion Manny Pacquiao for allegedly misdeclaring his income in 2009 is “a bridge that is too far away yet,” President Aquino said on Tuesday.

Aquino noted that Pacquiao, the representative of the lone district of Sarangani, had not even owed up to his tax deficiencies.

“I think the lesson has to be that if you are guilty of a particular crime, then…you have to exhibit a degree of remorse. But, at this point in time, he says that he has complied with all the requirements. So I think this is crossing the bridge that is too far away yet,” said Aquino, when interviewed at the 27th annual Bulong Pulungan Christmas Party.

Aquino explained that any amnesty proposal would emanate from his office and should be approved by Congress.

“Amnesty is (a) proposal by me (which) has to normally indicate, perhaps, a class of individuals, a group. It doesn’t refer normally to an individual,” said the President, when asked if he would be open to extending amnesty to Pacquiao.

An amnesty does not extinguish a taxpayer’s liabilities as it only condones penalties and does away with imprisonment for tax-evasion cases.

On Thursday, Revenue Commissioner Kim Henares said that Pacquiao “technically misdeclared” his income in 2009 when he stated in his tax return that he earned only less than P50 million in the Philippines and when he failed to include his earnings from his two fights in the United States that year.

Pacquiao’s gross income should have been closer to or even more than P1 billion, claimed Henares, who froze his bank accounts for allegedly failing to settle P2.2 billion in tax deficiencies.

Pacquiao, one of the world’s richest athletes, had just returned from a convincing victory over American Brandon Rios in a welterweight match in Macau when news about his tax problems resurfaced.

He protested the Bureau of Internal Revenues (BIR) move to freeze his bank accounts, insisting he had already furnished the bureau copies of tax returns submitted to the US Internal Revenue Service to show that he had paid his income taxes.

Pacquiao said he was not hiding or running away from his tax responsibility, and expressed confidence that the issue would be settled soon.

The BIR started to investigate and audit Pacquiao in late 2010 after an “abrupt” drop in his ranking among the country’s top taxpayers, said Henares.

From 2006 to 2008, Pacquiao was in the top 10 percent of highest taxpayers but he slid to the top 30 percent in 2009.

When the BIR audited him for his 2008 and 2009 income tax returns (ITRs), Pacquiao did not submit any documents, thus prompting the agency to subpoena him. He responded by executing an affidavit declaring his US income and tax payment in his 2008 ITR but without any supporting documents.

In that instance, Henares said the BIR did not become strict in asking documentation and allowed him to claim tax deductions.

But when Pacquiao claimed tax deductions for expenses, he was unable to provide documentation, she said. The BIR then assessed that he had P769 million in tax obligations, including value-added tax.

On his 2009 ITR, Henares said Pacquiao did not declare any US income but only less than P50 million earned in the Philippines, thus the “underdeclaration.”

The agency estimated his tax obligations for 2009 at P1.433 billion based on his income in the United States from “public information” on his bouts there and shares from pay-per-view and online ticket purchases, as well as endorsements.—With a report by Christine Avendaño

source: sports.inquirer.net

Top Rank paid for Pacquiao tax

MANILA, Philippines – Hall of Fame promoter Bob Arum has assured the Bureau of Internal Revenue that Manny “Pacman” Pacquiao’s taxes have already paid for in the Internal Revenue Services following the boxer’s tax issues in the country.

“Filipino authorities confirmed that Manny is not required to pay double tax,” Arum said in a statement published in fightnews.com. “If Manny paid United States taxes for fights and endorsement that occurred on U.S. soil, he is not required to pay double taxes in the Philippines.”

This followed after the BIR issued a warrant of “distraint” early this year against the Fighting Congressman after it said he failed to remit taxes amounting to P2.2 billion to the government of his earnings stemming from 2008 and 2009.

According to Arum, Top Rank withheld 30% of Pacquiao’s purses and paid those sums directly to the IRS including the boxer’s fights that happened in the U.S. in 2008 and 2009.

“Top Rank has deposit confirmations for each payment,” said Arum whose promotions company made the payments through Electronic Funds Transfer (EFT). “Top Rank has done the same for all U.S. endorsements it has facilitated on Manny’s behalf.”

Arum added that the Top Rank has submitted copies of the EFT deposit acknowledgements to the BIR as proof of the payment.

“The BIR received the documents but directed Manny to obtain ‘certified’ documents directly from the IRS itself.”

Arum said that obtaining the copies of the documents from IRS takes a lengthy process, nonetheless, the promoter said that the eight-division world champion made the formal request to the IRS and expects that the documents will be furnished to the BIR “very soon.”

source: sports.inquirer.net

Biggest celebrity endorsers didn’t make it to list of top taxpayers

MANILA, Philippines–Some of the country’s biggest celebrity endorsers did not make it to the list of top individual taxpayers, according to the Bureau of Internal Revenue.

In its weekly print advertisement for the government’s tax campaign, the BIR cited the list of 24 biggest celebrity endorsers for 2011 published by Yes! Magazine and revealed whether they made it to the list of Top 500 taxpayers.

The BIR noted an interesting finding that more than half, or 15, of the Top 24 celebrity endorsers for 2011 were not in the list of Top 500 taxpayers for that year.

These were the following: couple Carmina Villaroel and Zoren Legaspi, Marian Rivera, Robin Padilla, Sarah Geronimo, Judy Ann Santos, Anne Curtis, Angel Locsin, Boy Abunda, KC Concepcion, Dingdong Dantes, Gerald Anderson, Bea Alonzo, Jericho Rosales, and Ai-Ai delas Alas.

For 2012, the couple Villaroel and Legaspi, Rivera, Rosales, and Delas Alas still did not make it to the BIR’s list of Top 500 taxpayers.



Ryan Agoncillo, husband of Judy Ann Santos, who was the 16th top celebrity endorser for 2011, was included in the BIR’s list of top taxpayers for the said year landing on the 194th spot. He paid P5.6 million in taxes that year.

However, Agoncillo did not make it to the list of top taxpayers for 2012.

Yes! Magazine has not yet published the list of top celebrity endorsers for 2012.

The list of top celebrity endorsers is based on the number of endorsements per celebrity and not based on amount of income earned from said endorsements.

The BIR clarified that one may not automatically conclude that the data provided in its weekly print advertisement showed tax evasion.

BIR Commissioner Kim Henares said the weekly advertisement was meant to encourage tax compliance.

She said people who may know whether individuals or corporations cited in the advertisements are indeed tax evaders are urged to report details to the BIR.

Meantime, the BIR ad likewise revealed that some of the biggest celebrity endorsers were also some of the biggest taxpayers in the country.

Kris Aquino, who was the top celebrity endorser for 2011, was also the No. 1 taxpayer for that year and was the 6th biggest taxpayer for 2012. She remitted P49.87 million and P44.93 million in taxes in the said years, respectively.



John Lloyd Cruz, who was the second biggest celebrity endorser for 2011, landed on the 205th rank of the BIR’s top taxpayers list for that year, having paid P5.4 million in taxes.

Cruz then significantly increased his ranking in the BIR’s list in 2012 to land on the 8th spot, having paid P42.79 million.

Piolo Pascual, who was the 3rd biggest celebrity endorser for 2011, ranked 123rd in the BIR’s list of top taxpayers for that year, having paid P6.98 million in taxes.

Pascual’s ranking with the BIR also substantially increased to 34th spot in 2012 when he paid P23.36 million in taxes.

Kim Chiu, who was the 7th biggest celebrity endorser for 2011, also was the BIR’s 133rd and 309th biggest taxpayer for 2011 and 2012, respectively. She remitted P6.7 million and P7.44 million in taxes in the said years.

Vic Sotto, who was the 11th biggest celebrity endorser for 2011, landed on the 19th and 89th spots of the BIR’s top taxpayers for 2011 and 2012, respectively. He paid P14.73 million and P14.62 million in taxes in the said years.

Michael V., who was the 19th top celebrity endorser for 2011, landed on the 178th and 118th spots in the BIR’s list of top taxpayers for 2011 and 2012. He paid P5.9 million and P12.6 million in taxes in those years, respectively.

Derek Ramsay, who was the 20th top celebrity endorser for 2011, landed on the 120th and 68th spots in the BIR’s list of top taxpayers for 2011 and 2012. He paid P7.08 million and P16.7 million in taxes in the said years, respectively.

source: business.inquirer.net

AOL to sell 800 patents to Microsoft for $1 bil

NEW YORK — AOL announced plans Monday to sell more than 800 patents to Microsoft in a $1.056 billion deal giving the struggling Internet pioneer a needed cash injection as it seeks to fend off pressure from shareholders.

The deal also provides Microsoft with licenses to more than 300 additional patents and patent applications, AOL said in a statement.

AOL chief executive Tim Armstrong said the deal “unlocks current dollar value for our shareholders and enables AOL to continue to aggressively execute on our strategy to create long-term shareholder value.”

Microsoft general counsel Brad Smith said in the statement that the software giant is getting “a valuable portfolio that we have been following for years and analyzing in detail for several months.”

He said Microsoft “was able to achieve our two primary goals: obtaining a durable license to the full AOL portfolio and ownership of certain patents that complement our existing portfolio.”

AOL said that after the deal is complete, it will continue to hold “a significant patent portfolio of over 300 patents and patent applications spanning core and strategic technologies, including advertising, search, content generation/management, social networking, mapping, multimedia/streaming, and security among others.”

AOL also received a license to the patents being sold to Microsoft.

The patent sale includes stock in an AOL subsidiary on which AOL expects to record a loss for tax purposes and as a result, AOL will offset most taxes in the deal.

The company said it intends “to return a significant portion of the sale proceeds to shareholders and will determine the most efficient and effective method to do so prior to the closing of the transaction.”

Earlier this year, a U.S. hedge fund with a large stake in AOL sought five seats on the board of directors and criticized the strategy of the current management for failing to deliver for shareholders.

AOL has been losing money since the collapse of its leadership as an Internet subscription service, and has been seeking to become a more diversified web firm.

The company fused with news and entertainment giant Time Warner in 2001 at the height of the dotcom boom in what is seen as one of the most disastrous mergers ever. It was spun off by Time Warner in December 2009 into an independent company.

Under Armstrong, hired three years ago, the company formerly known as America online has invested heavily in online content, purchasing The Huffington Post and TechCrunch websites and putting money in local news network Patch.

The transaction is expected to be completed by the end of 2012, the companies said.

source: japantoday.com

From being No. 1 taxpayer in 2008, Pacquiao slides to 135th spot in 2010

From being number one in 2008, Sarangani Rep. and world boxing champion Manny Pacquiao slid to the 135th spot among the country’s Top 500 individual taxpayers in 2010, latest data from the Bureau of Internal Revenue (BIR) showed.

Pacquiao, who is currently at loggerheads with the BIR, paid only P9,190,691 in taxes in 2010 despite having a taxable income of P504.5 million, the bureau said.

In 2008, Pacquiao paid over P125 million, making him the top taxpayer for that year.

The eight-time world champion is currently facing a criminal case for obstructing a tax investigation into his earnings, a case that he said has cost him a fortune in endorsements.

The case was filed by the BIR last February after Pacquiao allegedly failed to submit proper documents about his earnings from boxing matches and his numerous commercial endorsements.

The BIR, through the agency’s regional director Rozil Lozares, issued a Letter of Authority to the boxing icon requiring him to submit documents regarding his earnings. Pacquiao allegedly failed to comply.

The BIR wants to investigate Pacquiao’s 33 tax records, including his annual income tax return in 2010, his book of accounts, list of assets, as well as his earnings from his fights against Antonio Margarito and Joshua Clottey.

GMA News Online called Pacquiao's business manager Rex "Wakee" Salud over the phone, but the boxing champ's camp is still to issue an official statement as of this posting.

Pacquiao’s tax payments substantially declined to some P7 million in 2009 from P125 million in 2008–a drastic drop that got the bureau curious.

Pacquiao has vowed to fight the case in court and accused the BIR of singling him out for harassment.

According to the latest BIR list, businessman Vicente Lao was the top taxpayer for 2010. He had a taxable income of P235 million that year and paid taxes of P75 million.

After Lao, businessman Rolando Hortaleza placed second with P69.665 million in taxes. Filmmaker Carlo J. Caparas, once the subject of a tax case filed by the BIR, came in third with P65.670 million in taxes.

For non-individual taxpayers, communications giant Smart Communications topped the list with P11.456 billion for 2010. Other top corporate taxpayers were Chevron Malampaya LLC (P4.378 billion) and Shell Philippines Exploration (P4.327 billion).

Nestle and San Miguel placed fourth and fifth, with P4.277 billion and P4.206 billion, respectively. — KBK/VS, GMA News

source: gmanetwork.com

UK will cut top income tax rate

Britain's finance minister has cut the rate of income tax for the country's wealthiest citizens but insisted the rich will pay more through a raft of measures to prevent tax avoidance and a hefty new charge on expensive property sales.

In his annual budget statement on Wednesday, George Osborne said he was cutting the top rate from 50 per cent to 45 per cent by April next year on incomes over STG150,000 ($A228,000)a year. He argued that the original higher rate did not yield as much as expected, partly because the rich were able to avoid the tax.

Osborne sought to deflect criticism that any largesse was confined to the wealthy by announcing a big hike in the level Britons start paying tax to STG9,205. There are doubts, however, as to whether the poorest in British society will reap the full reward, given they may lose some benefits.

'Together, the British people will share in the effort and share the rewards,' Osborne said at the conclusion of his hour-long statement. 'This country borrowed its way into trouble, now we're going to earn our way out.'

The 50 per cent tax rate was introduced by the previous Labour government in response to the sharp deterioration in public finances in the wake of a banking crisis that led to the country's deepest recession since World War II.

The leader of the Labour opposition Ed Miliband pounced on Osborne's decision to cut the top rate of tax, mocking him for his oft-repeated mantra that 'we're all in this together.'

'After today's budget, millions will be paying more while millionaires pay less,' Miliband said.

Osborne insisted that the rich should pay a bigger proportion of their income than the poor and said he was offsetting the cut in the top rate by other taxes on wealth, including a new seven per cent charge on the sale of houses valued over STG2 million, up from five per cent.

Most of those residences are located in London, which has become a second home of choice for many of the world's super-rich - Russian oligarchs and hedge fund managers have all converged on the capital, driving up the cost of homes to levels that are unaffordable to the vast majority of Londoners.

Tony Ryland, a senior tax partner at London Chartered Accountants Blick Rothenberg, said the changes will have 'a major effect on the London housing market, potentially driving away overseas buyers.'

Overall, the budget measures were broadly neutral. Osborne has little room for manoeuvre, given the government's primary plan to dramatically reduce borrowing and recent warnings from credit ratings agencies that they could cut the country's cherished triple-A rating if public finances don't improve.

The government's debt-reduction program has been rewarded in the money markets to an extent, even though the economy has flatlined and unemployment stands at a near 17-year high. Unlike other big borrowers in Europe, such as Greece and even Italy, Britain - the biggest European economy that does not use the euro - has enjoyed super-low borrowing rates, making the deficit easy to finance.

Osborne said he was asking the Treasury to examine whether it would be wise for Britain to start issuing bonds of duration longer than 50 years to lock in the current historic low interest rates. The yield on Britain's ten-year bond is around 2.3 per cent, in line with the equivalent US rate.

Economic growth this year will be 0.8 per cent, up from a previous forecast for 0.7 per cent, according to the Office for Budget Responsibility, an independent agency tasked by the government to compile projections.

Osborne said Britain was likely to avoid a technical recession, officially defined as two consecutive quarters of negative growth. In the last three months of 2011, Britain contracted by a quarterly rate of 0.2 per cent.

In 2013, Osborne said Britain's economy would likely grow two per cent, slightly lower than the previous forecast of 2.1 per cent. The projected growth rates remain below the long-run average of 2.5 per cent.

Meanwhile, the budget deficit in the current fiscal year, which ends March 31, will be STG126 billion, STG1 billion less than expected. As a percentage of GDP, debt will peak at 76.3 per cent in 2014-15, lower than previously thought.

source: http://www.skynews.com.au/world/article.aspx?id=731491&vId=3139065&cId=World