Albay 2nd district Rep. Joey Salceda wants to get to the bottom of allegations that DITO Telecommunity Corporation is bypassing its interconnect agreements with other telecommunications companies, causing foregone interconnection payments of around P2.5 million daily, or from around 1,000 international voice calls allegedly masked as local calls.
As such, Salceda said that the House Committee on Ways and Means, which he chairs, will conduct an inquiry, in aid of legislation, on the probable tax liabilities of the relatively new telco.
Salceda said the government could be losing “at least P7.5 million monthly due to this bypassing, if the figures alleged by the other telecom companies are true".
Under Section 120 of the National Internal Revenue Code, there is a 10 percent tax on “every overseas dispatch, message or conversation transmitted from the Philippines by telephone, telegraph, telewriter exchange, wireless and other communication equipment service".
“By masking the calls as local, they effectively doing services smuggling. I am all for cheap international calls, because OFWs (overseas Filipino workers) need to connect to their loved ones here. But, we cannot condone nefarious means of doing business, especially if it deprives the country of precious tax revenues, the lifeblood of government," the Bicolano said.
“So, I want to know if there is basis to say that DITO is violating such tax provision, and what our tax authorities can do about it. I also want to hear DITO’s side," he said.
Salceda underscored: "As our record has shown, the Committee on Ways and Means does not investigate to embarrass, to harass, or to intimidate, but to make good policy."
“You will recall, for example, that with the Megaworld tax issue, we were able to get the tax authorities to follow regular order, while also making Megaworld commit to cooperate with the government fully. The same result, I hope, will come out of this exercise," he further said.
The House panel will be calling the Bureau of Internal Revenue (BIR), the National Telecommunications Commissions (NTC), representatives of DITO and telcos it has interconnection agreements with, and other key stakeholders to the hearing.