The decision, signed by Associate Justices Catherine Manahan, Jean Marie Bacorro-Villena, and Marian Ivy Reyes-Fajardo, stated that the prosecution failed to prove the accused’s guilt beyond reasonable doubt.
It covers four charges, three counts for the violation of Section 255 of the National Internal Revenue Code (NIRC) for incorrect and inaccurate information on income tax return for 2015, and value-added tax returns for the third and fourth quarters of 2015, and for violation of Section 254 of the NIRC, also known as tax evasion.
Rappler was accused of evading tax payments amounting to around P141 million when it increased its capital through partnership with foreign investor North Base Media (NBM) and Omidyar Network (ON) involving the issuance to the two entities of Philippine Depositary Receipts or PDRs.
The court upheld the non-taxability of the issuance of PDRs to North Base Media and Omidyar Network, noting there was no gain or income realized by the accused in the subject transactions.
“Since the accused is not required to pay the income tax and VAT on the PDR transactions for the taxable year 2015, the elements of Sections 254 and 255 of the 1977 NIRC as amended, are rendered nugatory and without legal support. The plaintiff therefore failed to prove the guilt of the accused beyond reasonable doubt,” the decision reads.
“There is nothing in the wordings of the PDR instruments and the PDR subscription agreements that would show the foreign entities NBM and ON will become owners of the shares of stock of Rappler,” it added.
In an interview with reporters, Ressa said: “Today, facts win, truth wins, justice wins.”
She also called for the release of former senator Leila de Lima, who is facing charges over alleged involvement in illegal drugs, and other journalists such as Frenchie Mae Cumpio, who was facing cases for illegal possession of firearms and was tagged as a member of the New People’s Army.
“These charges were a brazen abuse of power, political harassment against journalists trying to hold power to account. This is where business, capital markets, and press freedom meet. So this victory is not just for Rappler, it’s for every Filipino who has ever been unjustly accused,” the Nobel laureate said.
Francis Lim, a lawyer for Rappler, said they are hoping that the other cases against the firm based on PDRs will be junked by the court.
“I don’t want to preempt the RTC, but they should take guidance from this court. I am not saying that this court decision is binding on them but it should provide some enlightenment to the RTC of Pasig,” he said.
Rappler is facing closure order issued by the Securities and Exchange Commission for violation of constitutional and statutory restrictions on foreign ownership in mass media. (SunStar Philippines)