Former radio host pleads guilty to tax evasion
A former radio talk-show host was today (April 19) sentenced to a three-month imprisonment and a fine of $200,000 for the four counts on signing fraudulent Profits Tax Returns by Magistrate Paul Kelly at the Western Magistracy.
The defendant pleaded guilty to all four charges on signing fraudulent Profits Tax Returns for the taxation years 1994/95 to 1997/98, contrary to section 82(1)(d) of the Inland Revenue Ordinance. Upon sentencing, she has applied for bail pending appeal.
The four charges were related to the returns the defendant signed on behalf of her service company. At all material times, the company's majority of income came from the defendant's radio programme from 1994 to early 1997.
The investigation by the Inland Revenue Department (IRD) upon complaint into the company's tax affairs revealed that the defendant had falsely reported in the tax returns of the company that an employee had been hired by the company as public relation assistant and received remuneration in the total amount of $208,400 for the two taxation years of 1995/96 and 1996/97.
It was further found that, apart from the false salary expenses, the company had in its returns for the four taxation years from 1994/95 to 1997/98 falsely claimed salaries expenses of $162,950 related to another employee, inflated its entertainment and staff benefits expenses in the sum of $735,536; and omitted to include as income a lump-sum contractual bonus of $450,000 received from the radio station in September 1994.
The inflated entertainment and staff benefits expenses were related to 98 restaurant receipts for consumption of meals at 27 restaurants. Among the business records submitted by the company in support of its expenses, 44 restaurant receipts were found to be false, and 54 restaurant receipts were altered.
As a result, in the four years of assessment, the company totally understated the profits by $1,556,886, involving the tax undercharged of $210,122.
An IRD spokesman reminds the public that tax evasion is a criminal offence. Upon conviction, the maximum sentence is three years' imprisonment and a fine of $50,000 on each charge, plus a further fine equivalent to three times the amount of tax undercharged.
End/Thursday, April 19, 2001