The camp of Vice President Sara Duterte cannot contest in the Supreme Court the legality of the possible release of her tax records if no less than President Marcos Jr. himself gives his imprimatur to the Bureau of Internal Revenue to produce it for the Senate impeachment court.

This is primarily because Section 71 of the National Internal Revenue Code (NIRC) empowers the President to allow the production and inspection of income tax returns—which are strictly confidential—according to impeachment court spokesperson Reginald Tongol on Thursday. 

“That power is provided by law,” he told reporters in a virtual briefing. He also answered in the affirmative when asked whether it cannot be legally challenged in the SC if the situation arises.

According to Tongol, the scenario mirrors the impeachment case of the late former SC chief justice Renato Corona in 2012, who was found guilty by the Senate impeachment court for betrayal of public trust and culpable violation of the Constitution for failing to accurately disclose his SALN (statement of assets, liabilities, and net worth).

At the time, former BIR Commissioner Kim Henares brought and presented the confidential income tax returns and records of Corona after securing the mandated clearance from then-President Noynoy Aquino.

The Senate impeachment court compelled the disclosure of Corona’s SALN to investigate the discrepancies in his SALN as alleged by the prosecution. 

“That was the process followed back then, which is why the presentation of tax records during the Corona impeachment trial was clear,” Tongol explained.

Under the Tax Reform Act (RA 8424), which amended the NIRC, tax records are confidential and may be disclosed only under limited circumstances, such as during executive sessions conducted in aid of legislation or with the taxpayer’s written consent.

Sara’s ‘unexplained wealth’

Similar to Corona, Duterte is also being accused of deliberately failing to truthfully and accurately declare her net worth and properties, which constitute an impeachable offense.

House prosecutors have sought to compel the disclosure of the history of Duterte and her husband, Manases Carpio’s, income tax returns and bank records to the Senate impeachment court to support allegations that she acquired unexplained wealth, contained under Article II of the Articles of Impeachment. 

The move had already met strong objection from Duterte’s defense as early as the pre-trial conference, citing tax and privacy, as Carpio is a private citizen.

In April, the House justice panel subpoenaed Duterte and Carpio’s income tax returns. Although the BIR produced it to the committee, lawmakers did not open the box and instead turned it over to the Senate along with the Articles of Impeachment to prevent legal complications with privacy law. 

The Senate impeachment court returned the unsealed box to the BIR on the first day of the trial on 6 July because it was not entered as evidence during the pre-trial stage.

However, the prosecution remained headstrong in scrutinizing Duterte’s financial records and asked the Senate impeachment court to compel it from the BIR. 

The court’s decision was supposed to be handed down on Wednesday, but it was deferred on Monday after senator-judges asked for an extension to peruse the opposing stances of the prosecution and defense in their memoranda.

Prosecution’s bid ‘illegal’

Lawyer Michael Poa, a former aide of Duterte, now spokesperson and a member of the defense, contended that the prosecution’s request must be denied on the grounds that the prosecution’s request is “fatally overbroad.”

Poa lamented that the prosecution wants an “unlimited search” through Duterte’s financial history, as they ask the impeachment court to compel her bank records as far back as 2007, or almost two decades, which he argued is not permitted by the law.

“To compel AMLC (Anti–Money Laundering Council) officials to disclose such information would be to compel them to violate the law,” he said during the oral arguments on Wednesday.

House prosecutor Chel Diokno, however, did not buy Poa’s alibi, asserting that there are specific provisions in the law that allow the disclosure of the financial records, particularly if compelled by the impeachment court. 

Under Section 2 of the Bank Secrecy Law (RA 1405), all deposits are considered absolutely confidential in nature except in cases of impeachment.

“There is no doubt. The impeachment court has the right to scrutinize VP Sara’s bank records,” Diokno responded.

Doubling down on his argument, the lawmaker contended that even the Data Privacy Act (RA 10173) “affirms that confidential information shall not apply should the information be needed pursuant to a subpoena fully issued.”