FID, TAJ investigation gets landmark tax evasion ruling

A 41-year-old businessman, Wen-Jun Kong, was on April 6 convicted in the Manchester Parish Court for cheating the public revenue and making a false statement to Tax Administration Jamaica (TAJ).

Kong is a shareholder and director of R&R Xpress Company Limited, which operates in the parish.

Kong was convicted on three counts of making a false statement to the TAJ in relation to income tax returns he filed for the period of 2012-2014. The prosecution, led by TAJ legal counsel, contended that his declarations were false and led evidence to substantiate the assertion.

He was also charged for two counts of Cheating the Public Revenue, after R&R Xpress Company Limited ‘failed to deliver or cause to be delivered to the Commissioner General of the TAJ a true and correct tax return for the years of assessment, 2012-2014’.

Kong’s journey to conviction began in November 2016, when he was arrested following an operation which targeted his residence and business offices. The operation was jointly executed by officers attached to the Constabulary Financial Unit (CFU), the Financial Investigations Division (FID), TAJ and the Mandeville police. The charges were laid after a two-year joint investigation by the FID and TAJ.

VERDICT

In commenting on the conviction, the FID’s Chief Technical Director Selvin Hay noted, “This verdict has signalled that the courts have an appetite for these types of matters. In collaboration with the TAJ, we will strategically target tax evaders, who may also see themselves being charged for money laundering.”

He added, “For too long tax cheats have been able to flourish at the expense of law-abiding taxpayers. The FID takes a zero-tolerance approach to persons involved in financial crimes, this includes tax evaders. Where the evidence of a breach is provided, we will be taking the necessary legal action to ensure that the individuals and businesses are brought to justice, thereby levelling the playing field for taxpayers.”

Those sentiments were endorsed in a statement by the TAJ, which expressed concern that, “some taxpayers continue to obtain an unfair tax advantage through tax evasion and non-compliance. The TAJ is committed through intelligence activities and the assistance of the public, to identify those taxpayers who contravene the tax laws and to prosecute where the evidence warrants. This conviction, that of cheating the public revenue at common law, is a seminal moment for TAJ.”

It continued, “Unfortunately, a few of our taxpayers continue to evade taxes and, in these instances, we will resort to prosecution under our tax laws, and the common law to preserve the integrity and fairness of our tax system. Though the authority continues to reap great success in its individual enforcement activities resulting in landmark convictions, the strength of its partnerships with other state agencies must be underscored. This commonality of purpose has advanced the realisation of a more tax-compliant Jamaica.”

Kong is to be sentenced on May 4.