Makati shuts down Smart’s main office over unpaid taxes

The Makati government orders the closure of Smart Communications (Smart) offices in the city over the unpaid taxes of P3.2 billion and operating without a business permit.

The advisory from the local government said that the telco has an unsettled franchise tax deficiency that covers January 2012-December 2015. In 2022 alone, Makati shut down 191 business establishments due to the lack of business permits. 

Image from Makati City government’s Facebook page

“When businesses in Makati choose to operate without a valid business permit, they are essentially operating outside the law,” Claro Certeza, city administration, Makati City, said in a statement. “This is unacceptable, and I want to make it clear that we will not tolerate this kind of behavior, whether you are a big or small company.”

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The Makati City government said the order came after the Office of the City Treasurer launched an investigation that started in 2016.

In a statement, Smart said it will comply with Makati City’s local tax ordinances and with applicable national laws, in respect of local taxation adding that it has filed appropriate cases to resolve outstanding legal issues.

Smart filed a petition for review in 2018 in response to the city’s notice that the company has not paid the franchise tax over the four-year period. The next year, Smart opposed Makati’s motion for production and inspection of documents and challenged this decision before the Court of Tax Appeals (CTA).

Last year, CTA denied Smart’s petition and affirmed the decision.