Court of Tax Appeals acquits Ressa, Rappler of tax violations

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Metro Manila (CNN Philippines, January 18) — The Court of Tax Appeals (CTA) acquitted Nobel Peace Prize winner Maria Ressa and her media company Rappler Holdings Corporation of tax violations.

The CTA First Division handed down the verdict on Wednesday, more than four years since the Bureau of Internal Revenue filed the complaints and the Department of Justice filed the cases in court in 2018 during the Duterte administration.

The government said the company acquired taxable income that it did not declare and thus incurred obligations when it issued Philippine Depositary Receipts (PDRs) to foreign investors North Base Media and Omidyar Network in 2015.

The government accused Ressa and Rappler of wilfully failing to supply correct information in their income tax and value added tax returns for 2015, for which they were charged with three counts of violation of the National Internal Revenue Code (NIRC). They were also charged with tax evasion.

Rappler said it did not gain taxable income from the issuance of PDRs, saying the investment instruments are meant to raise capital and not for profit.

In siding with the online news group, the court said the unpaid tax obligation charges have not been factually and legally proven.

“The court concludes that the aforementioned elements of the crime charged under Sections 254 and 255 are not present,” its decision read.

“Foremost among the elements of the crimes charged is that the accused is liable to pay tax under the 1997 NIRC, as amended," it added. "As discussed, no gain or income was realized by accused in the subject transactions."

The CTA also ordered the cancellation of the cash bail bonds of Ressa and the RHC.

‘Triumph of facts’

Rappler called the ruling a victory of facts over politics.

“We thank the court for this just decision and for recognizing that the fraudulent, false, and flimsy charges made by the Bureau of Internal Revenue do not have any basis in fact,” it said in a statement.

Ressa and her supporters previously said they believed the charges were politically motivated as the firm earned the ire of then President Rodrigo Duterte for its critical reportage of his administration. The Duterte government denied this.

“We’re happy that the Court of Tax Appeals saw no basis for the charges,” the group Human Rights Watch said. “We have always maintained that these were bogus and politically motivated."

"We hope the courts rule similarly in the other questionable cases Maria and her colleagues at Rappler have been forced to face,” it added.

The National Union of Journalists of the Philippines (NUJP) also praised the ruling, saying this serves as an inspiration for colleagues similarly facing legal challenges in relation to their work.

"We take inspiration from this acquittal that if we stand up and hold the line, we can win,” the NUJP wrote.

Several nations — including Canada and the Netherlands — likewise lauded the development, which they called an “important step” towards achieving press freedom in the country.

READ: Nations, groups laud tax violation acquittal of Rappler, Maria Ressa

Motion for reconsideration?

Justice Secretary Jesus Crispin Remulla said he respects the decision.

He noted that the prosecution may still lodge an appeal.

“[It] shows you that the rule of law is here in the country. Wala tayong magagawa, ‘yan talaga ang desisyon (We can’t do anything about it, that’s the decision,” Remulla told reporters later in the day.

“Although I believe that the prosecution is still filing a motion for reconsideration,” he added, but did not provide further details.