The Court of Tax Appeals (CTA) has ordered the Makati city government to pay the Bureau of Internal Revenue (BIR) some P1.2 billion in back taxes, Revenue Commissioner Joel L. Tan-Torres disclosed on Thursday.

The CTA issued the order after it dismissed the motion for reconsideration filed by the city government to protest an earlier verdict requiring it to settle the indebtedness.

The CTA denied the motion for lack of merit, declaring that the BIR tax assessments have factual and legal basis contrary to the claims of the local government.

The tax debts covered mostly unremitted withholding taxes due from salaries of city workers and payments of the city from its suppliers of goods and services for the years 1999, 2001, 2002 and 2004.

The city was originally assessed to owe the BIR some P2 billion in deficiency taxes.

It can be recalled that two years ago Makati Mayor and now Vice President-elect Jejomar Binay remitted to the BIR P500 million for the settlement of the huge accounts. But BIR insisted that it was only a partial payment.

"I am happy and relieved that the CTA upheld our assessments, aptly illustrating that we are just doing our job as tax enforcement agency and the BIR can now proceed with the collection of the deficiency taxes long due to the government coffers," Tan-Torres said.

"As I have stated in the past, we will proceed with the collection of unpaid taxes due from delinquent taxpayers, whether or not it is a government entity with this case serving as a lesson for other taxpayers to mend their ways and start complying," he added.