Fri. May 27th, 2022
Cartoon by Steven Pabalinas

The P203 billion which presidential candidate Isko Moreno Domagoso and retired justice Antonio Carpio have been alleging are “unpaid estate taxes” the Marcoses owe government will go down in our political and media history as one of the most preposterous lies to have ever been given some attention.

Thanks again, of course, to the virulent anti-Marcos Philippine Daily Inquirer and Rappler — the only two media outfits that’ve been screaming over it.

This “estate tax” brouhaha was concocted in a desperate move to breathe some life into candidate Moreno’s dying campaign; he has gone to town to disseminate that cock and bull story.

However, by spreading the lie, Moreno has definitively demonstrated he is totally unfit to be president as he is either so gullible to believe the yarn invented by the ever-scheming Carpio or so unprincipled to spread something he himself knows is a fallacy.

That this is a colossal fabrication is easily gleaned from the fact that among the alleged Marcos assets on which the estate taxes were levied include stocks in San Miguel Corporation and Manila Bulletin, and shares of the late drug tycoon J.Y. Campos as well as such properties like Fort Ilocandia, the Coconut Palace, and the sugar lands of Roberto S. Benedicto in Negros. Why on earth would the Marcoses pay estate taxes on these?

Yes, Mr. Dumb candidate, these “unpaid estate taxes” include assets which the Presidential Commission on Good Government (PCGG) had sequestered in the 1980s. Many of these were ordered by the courts to be returned to their owners (in the San Miguel case, to Eduardo Cojuangco), or which the owner had surrendered to government, which then auctioned shares sold many decades ago.

As the current PCGG clarified on March 22 when Moreno’s party asked about this “unpaid estate taxes”: When the Cory government sequestered these assets, it “legally laid claim to them [and are in custodial legis],” and therefore beyond the Marcos rights over and liabilities arising from them.

Even if the Marcoses wanted to pay the alleged estate taxes, their being in government’s custodial legis bars them from doing so.

The PCGG also disclosed in its letter that there was a “verbal agreement” in 2003 between it and the BIR to determine which among the properties the latter wanted to levy estate taxes on were sequestered and which were not. The PCGG and the BIR never got around to doing that chore, understandably as there were 300 lots and over 200 companies/shares in corporations the latter had levied estate taxes on.

The heirs of President Ferdinand Edralin Marcos.

Inheritance tax

I would think no matter what a dummie you are, you have to understand that “estate taxes” are different from “real estate” taxes.

Indeed, much of the traction of this preposterous lie is because Domagoso and Carpio have exploited the fact that many people confuse real estate taxes (“amilyar” in Filipino) with estate taxes (no Filipino translation).

To avoid such confusion, I will instead use the term inheritance tax instead of estate tax, which are synonymous under Philippine law.

If you own a piece of land, and you don’t pay the taxes on these, called “real estate” taxes. You’ll be losing that lot when government garnishes it and sells it to pay for the amilyar. Contrast this to an estate tax.

Your grand uncle dies, you inherit his property (not necessarily real property but shares of stocks for example) which the BIR says is worth P10 million. But you don’t have the P2 million (20 percent of the property’s value) to pay the inheritance tax that needs to be paid on it for it to be transferred to you. Thanks, but no thanks, you tell the BIR, shove it.

If Domagoso and Carpio werer right in their reading of the Internal Revenue Code, I would have to warn my cousin who’s been living in Canada since the 1980s never to visit. He has an uncle who died five years ago here and he is the sole heir of his properties, but since he’s a tech millionaire there, he’s been too busy to come here to work on the papers to claim the property, and doesn’t care about it.

Some lawyer like Carpio may have asked the BIR to compute the inheritance tax and finding that he hasn’t paid for it, will ask a court to jail him, as Carpio demanded Marcos in his case.

(With Domagaso’s obviously poor understanding of real estate taxes, the Manila government should check if the right property taxes were levied on his P1.4 billion sale of the Divisoria Market, reportedly to an obscure Tondo-based businessman.)

With this, it should be clear that Carpio’s P203 billion figure of unpaid inheritance taxes is totally a figment of his depraved mind. He imagined that the BIR had demanded payment of a P23 billion tax deficiency in 1990, which he computed, as a result of interest rates and penalties, amounts to P203 billion today.

He can’t admit in his mind that the P23 billion figure is entirely a hypothetical one, which the BIR claims the Marcoses would have to pay if those alleged assets are turned over to them.

But the Marcoses have not acquired those assets at all, either because they are still have not acquired those assets at all, either because they are still sequestered, returned to their real legitimate owners (such as Cojuangco), or sold off.

There may be assets that are in their control now, but the BIR had not informed them 35 years ago or today, how much inheritance taxes they should have paid on them.

The BIR letter did not stipulate an amount. Aksyon Demokratiko president Ramel got his P203 billion from the column of former Chief Justice Antonio Carpio. GR 120880 ruled with finality on the amount P23 billion but it has wrought with infirmities and cannot be executed. The Supreme Court only deals with laws, not facts. This why the prosecution itself filed a Motion for Reconsideration with the Sandiganbayan to shape up because many inclusions on the taxable assets have had third party claims.

Indeed, that the P23 billion figure is merely a hypothetical inheritance tax estimate is the reason why for 35 years since that assessment was issued, five BIR commissioners and five administrations (including two Yellow ones, Fidel Ramos and Benigno Aquino 3rd) had paid no attention to it. Only Carpio out to impress the gullible Domagoso has been a crackpot enough to raise this nonsensical issue.


This estate-taxes black propaganda pathetically intended to stop Marcos, Jr. from winning the May elections, reminds us how ruthless the Cory regime was in its campaign to totally crush the Marcoses.

In its plot to ensure that the strongman’s death in September 1989 would also mean his total political extinction, which she thought would happen if his heirs were left with nothing, Aquino’s BIR scrambled to demand in June 1990 the payment of the inheritance taxes on the Marcos estate, which the BIR computed to be P23 billion, a figure deliberately concocted to be so big his heirs would not be able to afford this.

Whatever assets the strongman could have left to them as their inheritance would be confiscated for their failure to pay the inheritance taxes. How did BIR come up with that huge figure?

The maximum rate for the computation of estate taxes at that time was 20 percent of the value of the assets.

To be sure that the estate taxes would be huge, and after all since it only had a small staff to sniff around what assets the strongman left, the BIR simply used the list of assets the PCGG had sequestered at that time, which the Cory regime had been using to create the myth of Marcos’ massive kleptocracy, bloated to include even properties of businessmen simply because they were known to be close to the strongman and his wife Imelda.


The BIR then used the figure the PCGG had been disseminating as the total value of strongman Marcos’ wealth when he died. Thus, the 20 percent estate tax was calculated on the assumed value of the assets that the PCGG had ordered sequestered, which was P115 billion, or the ballpark figure for the “hundreds of billions” in Marcos’ alleged “ill-gotten wealth” the Cory regime had been bandying about.

In its rush to demand an inheritance tax on Marcos’ properties, the BIR threw in every property it could think of which they heard from friends’ friends were allegedly owned by Marcos.

There was another motive for the Cory regime to require the P23 billion inheritance tax. It became worried its sequestration would be challenged in the courts, which could rule that such confiscations were illegal or that the PCGG could not prove that they were acquired through corruption. This in fact was what happened in so many cases, epitomized by the return of San Miguel and coconut-levy firms to Eduardo Cojuangco.

If that happened, Cory’s lawyers assured her, the Marcoses won’t have access to those assets on which the inheritance taxes were imposed, as they had not paid the P23 billion inheritance tax plus penalties.

It turned out though that that scheme was too stupid that no government lawyer had raised this issue to stop the lifting of a sequestration on a particular property. How could for instance Hacienda de Fuego which was in the BIR list, be shown to owe inheritance taxes when that list didn’t impute a value to it, with the total P23 billion figure being simply an “estimate” of the total value of the 500 assets.

What a waste of our time this issue which Domagoso raised has been.

Properties of Marcos crony Eduardo “Danding” Cojuangco, for instance @San Miguel Corporation and @United Coconut Planters Bank were sequestered on mere suspicion that he was a dummy for President Marcos. Danding went to court and that sorted out things and he git his just desserts. However, those properties could still be part of the “taxable” inheritance that GR 120880, comprising the principal that the used BIR to compute of the P23 billion it rendered with finality, but which is not enforceable without violating the due process rights of the Marcoses.

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