DOJ backs tax evasion charges vs. 'BGC Boys' over P1.68-B liabilities

The Department of Justice (DOJ) has found probable cause to file 44 criminal tax evasion cases against members of the so-called "BGC Boys" or Bulacan Group of Contractors over alleged tax liabilities totaling ₱1.68 billion, the Bureau of Internal Revenue (BIR) said.

In separate resolutions, the DOJ recommended the filing of criminal charges against former Department of Public Works and Highways (DPWH) Bulacan officials Jaypee De Leon Mendoza, Henry Alcantara and Brice Ericson Hernandez for violations of Sections 254 and 255 of the National Internal Revenue Code, as amended.

The cases will be filed before the Court of Tax Appeals.

According to the BIR, the respondents were subjected to a lifestyle check that allegedly revealed spending inconsistent with their declared income.

The agency said it used the expenditure method, a recognized tax investigation tool that reconstructs income by comparing declared earnings with actual expenditures.

"The BIR used the expenditure method, a recognized method for reconstructing income in tax investigations, wherein unexplained expenditures exceeding reported income may be treated as evidence of unreported taxable income," the agency said.

Investigators also found alleged non-filing and underreporting of tax returns over several taxable years.

The DOJ recommended filing 16 criminal informations against Mendoza involving alleged tax liabilities of ₱179.785 million from 2021 to 2024; 18 criminal informations against Alcantara involving ₱913 million from 2022 to 2024; and 10 criminal informations against Hernandez involving ₱593.776 million from 2020 to 2024.

BIR Commissioner Charlito Martin Mendoza said the DOJ's finding of probable cause marks a significant milestone in the agency's tax enforcement efforts.

He said the cases demonstrate the BIR's commitment to enforcing tax laws based on evidence while observing due process.

Hernandez and Mendoza are currently detained at the New Quezon City Jail, while Alcantara is under the Witness Protection Program.

The three are also facing separate graft complaints before the Office of the Ombudsman. Their assets were previously included in the first batch of freeze orders covering 135 bank accounts and 27 insurance policies.