The Bureau of Customs (BoC) wants Presiding Justice Ernesto D. Acosta of the Court of Tax Appeals (CTA) to inhibit himself from the case involving the government’s claim of P7.34 billion in unpaid taxes from Pilipinas Shell Petroleum Corporation.

The case is currently pending with the CTA.

The Philippine government wants Shell to pay P7.34 billion in unpaid excise taxs and VAT for its unleaded gas importations from 2004 to 2009.

Shell claimed it was exempt from paying excise taxes on its unleaded gas importations on the basis of a March 24, 2004 legal memorandum by former Bureau of Internal Revenue (BIT) Deputy Commissioner Jose Mario Buñag. Buñag’s ruling was affirmed by former Commissionerof Internal Revenue Sixto Esquivias IV.

The BoC argued that Buñag’s memorandum was unauthorized and had no legal basis. It said that at the time of the memorandum, Shell was paying excise taxes on its importations of unleaded gasoline, thereby recognizing its own tax liability under the law. According to the BoC, Shell cannot escape its tax liability by relying on the illegal memorandum.

On the other hand, the Bureau of Internal Revenue (BIR) upheld the position of the BoC that Shell is liable for more than P7-billion in excise taxes and VAT on its unleaded gas importations from 2004 to 2009.

In a ruling by Commissioner of Internal Revenue Joel Tan-Torres, the BIR reversed with finality the earlier ruling of Deputy Commissioner Jose Mario C. Buñag.

Tan-Torres ruled that the exemption given to Shell from excise taxes on its unleaded gasoline importations “has no legal and factual basis.’’ (Jun Ramirez)