BIR padlocks lechon store for not paying taxes

A popular lechon store was temporarily padlocked on Thursday by operatives of Oplan Kandado of the Bureau of Internal Revenue for not complying with value-added tax (VAT) requirements.

According to the bureau, Z Lechon Global Inc. violated Sec. 15 of Republic Act 8424or Tax Code of 1997 for not shifting to VAT receipts and for failing to pay the right taxes.

BIR records showed Z Lechon posted a gross income of P15 million in September to December 2016 and paid a corresponding percentage tax of 455,000 instead of paying VAT of P1.82 million.

“Once your sales reach P1.919 million you should convert from paying percentage tax to VAT,” BIR Chief Revenue Officer IV Teodoro Huelva noted. “Until now the business hasn’t converted to VAT,” he said.

The company was given a 48-hour notice to explain why the business should not be sanctioned for violating  the Tax Code.

Sought for comment, Z Pambansang Lechon Global Inc. CEO Manuel Zalamea  said his family was “surprised” by the BIR’s action on the Z Lechon store.

In a text message to GMA News online, Zalamea said the old company, Z Pambansang Lechon Inc., has a pending case in court against some 20 employees who allegedly stole P25 million from the company.

“There is a company that has obligation with BIR. ‘Yun po ‘yung ninakawan ng cumulative 25 million,” he said.

“‘Yung new company po na BIR compliant is the one operating now. Since the business is good naman, nanakawan lang, we opted to get investors for the business to be able to operate again,” he said.

The BIR served the company a five-day VAT compliance notice (VCN), but the bureau said it received a reply from Z Lechon management saying it was no longer operating.

BIR officials found out when they served the closure order that that wasn’t the case. In fact, the store was roasting lechon when the operatives arrived, the bureau said.

“They were saying that the business is already closed so the district started monitoring, visited the establishment, and found out the business is still ongoing,” BIR Regional Director Marina de Guzman said.

“Nagtetake pa rin sila ng order. As a matter of fact, may big time business na may order ngayon. Hindi pa talaga sila sarado.”

Z Lechon management must settle with the BIR P3.2 million in five days from Thursday to reopen its store. —With a report by Margaret Claire Layug/VDS, GMA News