Mandaluyong restaurant padlocked by BIR
Posted on May 31st, 2009
A Chinese restaurant in Mandaluyong City has been padlocked upon the order of the Bureau of Internal Revenue (BIR), for failing to pay proper taxes. BIR ordered the temporary closure of Han Nan Food Corp., more popularly known as the Han Pao Tea House.
The closing of the establishment is part of the campaign of the BIR in its Oplan Kandado Program which seeks the closure of business of non-compliant taxpayers.
The closure of Han Pao was ordered by BIR Commissioner Sixto Esquivias IV because of the establishment’s failure to comply with the 48-hour notice and five-day value added tax (VAT) notice issued and served by the BIR. Said notices gave Han Pao management the opportunity to explain and settle its tax violations.
According to the BIR, the restaurant had an alleged under-declaration of sales by 205.44 percent in taxable year 2007 and 176.26 percent in 2008, amounting to a total of roughly P27 billion. Han Pao brings to 18 the total number of establishments closed by the agency nationwide upon the implementation of its Oplan Kandado Program.
The BIR said it is expecting to raise at least P10 billion from the program through an expected increase in tax compliance. Grounds for closure of a business establishment include failure to file a VAT return, understating taxable sales or receipts by 30 percent or more of the correct amount in the case of a VAT-registered taxpayer or failure to register the business.
The campaign will have the establishment closed for at least five days and will be in force until the violation is rectified by the taxpayer. BIR will only lift the closure order when there has been subsequent filing or amendment of returns with the payment of the tax as well as penalties.
Other establishments closed earlier by the BIR under the program are: La Suerte Grocery & Bakery in Magalang, Pampanga for failure to declare more than P50 million in income in 2008; Charmy Food Phils, Inc. a manufacturer of soybean products in Pasig City, for not declaring P40 million in sales for 2005 to 2008; and Arra’s Fine Dining, a Korean restaurant in Makati City for understatement of its taxable sales in 2008 by more than P20 million.
