Manny Pacquiao’s bank accounts in the Philippines have been frozen, stopping him from fulfilling his promise to help typhoon victims in his homeland, according to his promoter.
Pacquiao was locked in training camp more than 400 miles away from the typhoon’s deadly devastation when it struck, killing more than 5,200, and he vowed after beating Brandon Rios by unanimous decision in Macao, China, on Saturday night Pacific time that he would roll up his sleeves and help with his country’s recovery.
“It’s completely not Manny’s fault and completely a government screw-up,” Pacquiao promoter Bob Arum told The Times on Tuesday.
The Associated Press in Manila first reported that Pacquiao, a congressman in the country, hasn’t proven to the country’s Bureau of Internal Revenue that he paid taxes in 2008-09 and that unless it’s clarified, he owes $50 million (2.2 billion pesos) in back taxes as of July.
Pacquiao said he paid taxes in the United States following his victories against Ricky Hatton and Oscar De La Hoya and that a treaty prevents double taxation. AP reported a criminal case was dropped by prosecutors for the boxer’s alleged unpaid taxes in 2010.
“I appeal to them to remove the garnishment so that I can move and pay for my staff's salaries,” Pacquiao told reporters in his southern hometown of General Santos City. “I am not a criminal or a thief.”
The Philippines' tax bureau previously contacted HBO about Pacquiao's pay.
A network official told The Times in an e-mail, "We received an inquiry from the Philippines Bureau of Internal Revenue over two years ago and informed them that as pay-per-view distributor, HBO PPV collects and remits pay-per-view receipts to the promoter, while the promoter contracts with and pays Manny Pacquiao."
Pacquiao said his wife Jinkee's accounts have also been frozen.
Pacquiao contends that if he had not paid the proper taxes in the U.S., he would have been arrested during one of his visits there.
An IRS spokesman declined to comment.
“The money that was garnished by [the Bureau of Internal Revenue] is not stolen,” he said. “This came from all of the punches, beatings, blood and sweat that I endured in the ring.”
Arum said Pacquiao should be credited in the Philippines for paying 30% in U.S. taxes while beating David Diaz, De La Hoya, Hatton and Miguel Cotto in four 2008-09 bouts.
Philippines tax authorities, however, have dismissed receipts of electronic transfers Arum’s company Top Rank provided showing U.S. taxes subtracted from Pacquiao’s purses as meaningless scraps of paper.
Philippines tax revenue chairman Kim Henares explained to AP, “What he can do is go to the IRS, ask IRS to certify this copy,” of his tax payments “as a true copy. We have been waiting for that for two years.”
Arum said he is “trying to get the IRS to notify the Philippines’ authorities … it’s really just a bureaucratic mess.
"In a sense, what we’ve given them is a scrap of paper, but it’s all we have until the Philippines’ IRS counterparts can tell them what was paid – which we know was 30% of whatever he earned. The tax rate is 20% in the Philippines, so he should get full credit.”
Arum said Pacquiao's accountant and attorneys in the U.S. most recently requested the IRS cerification of taxes paid 60 days ago.
Pacquiao’s financial situation has long been cloudy. He’s frequently surrounded by dozens of paid hangers-on and has been overly generous in the past about handing money to countrymen and others in need.
Arum told The Times earlier this year that he fronted Pacquiao money in advance of his guaranteed $18 million purse he’ll receive for beating Rios. Pacquiao also stands to receive a percentage of pay-per-view sales, Arum said.
Henares said of 22 banks her agency has ordered to report on Pacquiao's accounts, only two said they held deposits for Pacquiao and that the total was only 1.1 million pesos ($25,200), which is now covered by the garnish.
“It is unbelievable to me that he has only 1.1 million pesos,” Henares said.
Arum said Pacquiao has other accounts elsewhere but declined to elaborate.
“He’s not desperate at all,” Arum said. “How can it be a desperate situation if I’m holding $18 million for him? It’ll get worked out.”
Pacquiao said Tuesday he borrowed more than $22,700 to purchase relief supplies before his fight Sunday with Rios in Macau and will borrow more to keep his word to typhoon victims. Pacquiao said he plans to provide aid to more than 10,000 families.
Arum previously donated $25,000 to the typhoon relief effort and said he’d be willing to front Pacquiao more money for the recovery, “but where am I going to put it?”