Tax dispute with Makati City remains pending, says Smart

SMART Communication, Inc. said the decision by the Court of Tax Appeals (CTA) allowing the Makati City government to inspect its documents over its alleged P3.25-billion tax deficiencies from 2012 to 2015 has nothing to do with tax evasion.

“At the outset, we wish to clarify the issue: this case stems from a dispute over the correct assessment of local franchise taxes by the Makati City government. Contrary to some published reports. It does not involve tax evasion,” Smart said in a statement on Wednesday.

Smart said it received an “erroneous” assessment for local franchise taxes (LFT) from Makati City in March 2018, covering the periods of 2012 to 2015. It filed a petition in July 2018 with the Regional Trial Court (RTC) seeking to nullify the assessment. The RTC granted in June last year the local government’s motion for production or inspection of Smart’s documents. Smart appealed the ruling to the CTA and asked for a temporary restraining order and preliminary injunction, which the court denied, upholding the RTC’s decision.

“It is important to note that the CTA has not decided on the LFT liability of Smart to the City of Makati,” Smart said. — Arjay L. Balinbin