THE Court of Tax Appeals (CTA) has denied OceanaGold Philippines, Inc.’s tax refund claim in the total amount of P407.37 million allegedly representing its wrongly paid excise taxes for the period July to December 2016.
In a decision dated Sept. 8, the tribunal said the mining firm failed to present documents proving the taxes were illegally imposed and diminished its operating expenses in connection with a financial technical assistance agreement (FTAA) it had with the state.
“Petitioner (OceanaGold) failed to present evidence that its payment of excise taxes had had an adverse effect on its financial position and/or performance as it did not also offer in evidence its audited financial statements during the subject period,” Associate Justice Jean Marie A. Bacorro-Villena said in the ruling.
Under the Philippine Mining Act of 1995, the government can only start collecting its share in the financial agreement after the FTAA mining contractor has fully recovered its pre-operating, exploration, and development expenses.
The tribunal cited a report from an independent accountant, which did not mention any “detrimental” effect on the firm’s operating expenses due to the tax payments.
The petitioner is a Canadian-Australian multinational gold producer that has a regional office in Makati City.
Last year, the CTA declined a separate OceanaGold appeal seeking to refund its alleged erroneously paid taxes worth P136.4 million based on the same conclusion.
Taxes collected during an FTAA contractor’s recovery period can only be deducted if it is proven to be recoverable by the company, it noted.
“As it is, the records of these such cases do not yield any evidence showing that such excise tax payments resulted in losses (to petitioner),” the court said. — John Victor D. Ordoñez