G.R. No. 253429 . October 06, 2021
GENOVEVA S. SUAREZ, PETITIONER, VS. PEOPLE OF THE PHILIPPINES AND THE BUREAU OF INTERNAL REVENUE, RESPONDENTS.

FACTS

On January 23, 2004, the Commissioner of Internal Revenue issued Final Assessment Notices and Final Letters of Demand to 21st Century Entertainment, Inc. for deficiency taxes totaling P747,964.49 for taxable year 2000. 21st Century, represented by its Vice-President John S. Suarez, filed a protest on February 26, 2004. However, for failure to submit supporting documents within 60 days, the case was forwarded for collection on December 5, 2005. The Revenue District Officer issued a First and Second Notice of Delinquent Account, followed by a Final Notice before Seizure on March 17, 2006. Petitioner Genoveva S. Suarez, the Executive Vice-President of 21st Century, sent a letter on August 24, 2006, requesting additional time to organize records and expressing willingness to settle the liabilities through compromise. Despite this, a Warrant of Distraint and/or Levy was issued on November 28, 2006, and a Warrant of Garnishment followed on March 7, 2007. An Information was filed against petitioner for violation of Section 255 in relation to Sections 253(d) and 256 of the National Internal Revenue Code (failure to pay tax). During pre-trial, it was stipulated that petitioner was the Executive Vice-President at the time of assessment. The prosecution presented evidence showing due notice and demand, and petitioner waived her right to present evidence. The Regional Trial Court convicted petitioner. The Court of Tax Appeals (CTA) in Division affirmed the conviction but modified the civil liability, holding the corporation liable instead of petitioner personally. The CTA En Banc affirmed the conviction.

ISSUE

Whether petitioner Genoveva S. Suarez, as Executive Vice-President of 21st Century Entertainment, Inc., is criminally liable for the corporation’s failure to pay its tax liabilities under Section 255 in relation to Sections 253(d) and 256 of the National Internal Revenue Code.

RULING

Yes. The Supreme Court affirmed the conviction. The elements of the crime of failure to pay tax are: (1) a tax is required to be paid by a person; (2) the person fails to pay the tax at the time required by law; and (3) the failure to pay the tax is willful. All elements were established. First, 21st Century was required to pay deficiency taxes. Second, it failed to pay despite repeated notices and demands. Third, the failure was willful, as the corporation, through its responsible officer, was aware of the obligation but did not pay. Petitioner, as the Executive Vice-President, is a responsible corporate officer under the law. Her act of sending a letter on behalf of the corporation requesting time and proposing a compromise is an admission of her responsibility and knowledge of the delinquency. An offer of compromise in a criminal case is admissible as an implied admission of guilt. The corporation itself is civilly liable for the unpaid taxes. The petition was denied for lack of merit.