Duterte impeachment trial Day 37
[ANALYSIS] Can Sara Duterte explain her wealth?
Day 37 of Vice President Sara Duterte's impeachment trial illustrated the proverbial legal pendulum swinging back and forth with the continuing examination of the witness from the Bureau of Internal Revenue.
On her second day on the witness stand, BIR's Anne Loraine Garcia-Marquez faced cross-examination by defense lawyer Kristine Ferrer and was confronted and, in the process, acknowledged certain issues raised on Day 36 about why, in Duterte’s 2023 income tax returns, she received compensation both as vice president and Davao City mayor.
Duterte last served as mayor from June 2019 to June 30, 2022, and thus it showed that she received from City Hall her salary in office for the last six months of June 2022.
For the same reporting year, she received compensation as vice president from June 30 to Dec. 31. Hence, both compensations were reported in her BIR Form 2316 in April 2023.
Both compensations were deducted withholding tax, an advance collection system where an employer deducts a portion of a taxpayer's income and remits it directly to the BIR.
As far as the 2022 compensation and 2023 tax declaration were concerned, that would have been all right.
CONTINUE READING BELOW
On interjections, Erwin and Raffy Tulfo asked why Duterte had received compensation from both offices. Raffy kept on calling it “income from legal fees,” while Garcia-Marquez kept on calling it “compensation.”
Sought by presiding officer Chiz Escudero for clarification, Garcia-Marquez said the same compensation package and tax appeared in her 2004 tax returns, which covered 2023 services, more than a year after Duterte left City Hall.
While Duterte and Carpio were both lawyers, Raffy once again blamed their staff for their failure to advise the couple of “erroneous tax declarations.” He had expressed similar frustration, asking why Duterte had not been advised to divest from her alleged companies.
Defense counsel Michael Poa stood up to declare that the defense would present a witness to debunk the allegation. He would be allowed to show contrary information when the defense time comes.
Compensation as legal fees?
Did Duterte indeed receive compensation classified as legal fees which, as claimed by the prosecutors, was an impeachable offense?
Garcia-Marquez was confronted with BIR documents in 2006 and 2018 showing Duterte classified herself and the nature of her income derived from it as “professional” and “legal fees,” respectively.
Because of such classification, Garcia-Marquez said the BIR “presumed” that the income Duterte had accumulated—when she became mayor for a three-year term in 2010, another three-year term that began in 2016, and another year term that began in 2019, and subsequently vice president in 2022—came from “sales receipts, revenues, and legal fees,” a possible violation of the provisions of the 1987 Constitution prohibiting her from engaging in other profession and business activity outside her two offices.
The income thus presumably came from legal fees, or derived from her law practice, possibly legal consultancy, unless otherwise contradicted possibly by sales receipts, say, showing proceeds from the sale of a car or a piece of other movable or immovable property.
Things would have been different had Duterte updated her income classification by removing “legal fees” early enough, Garcia-Marquez said.
Such entries were all right when Duterte was still out of public service. When in government service, the entries became tricky and messy, indicating conflict of interest.
Ferrer introduced the power of the BIR to issue a letter of authority to compel Garcia-Marquez to disclose if the BIR had found any compelling findings on the couple’s tax returns. Despite her repeated questions, Garcia-Marquez refused to disclose anything on the grounds that the BIR is prohibited by secrecy laws.
Prosecution lawyer Erwin Matib had rejected the topic, but he expressed surprise that the defense had brought it all up.
“May we put on record that it was the defense who put on the screens these LOAs which, according to them, are supposed to be confidential?” he said.
Escudero had to cut him short. “It only shows that the confidentiality clause worked both ways, both for the prosecution and the defense,” he said.
Such confidentiality, which the defense had pushed so hard on Day 36, found Ferrer in an awkward position. Her technical staff showed a report on the screen containing the names of certain BIR examiners. She was censured.
Because of the confidentiality issue, the discussion on LOA reached a dead end.
Duterte and Carpio-linked companies
As the trial went on, more questions were raised over and over again, all zeroing in on two major issues: Have Duterte and Carpio accumulated wealth more than their respective capacities, and if so, did the couple, as well as his alleged companies, declare these properly as required by law? These questions caused the pendulum to swing back and forth.
To be fair, taxation has been considered one of the more difficult subjects in law and business, because tax laws are built on conflicting policy goals, layered with constant legislative changes, and written in dense legal and accounting language.
Because of such difficulty, netizens watching the trial had a field day talking about something else. They avoided commenting on the witness’s testimony and questions raised either by the prosecution and the defense lawyers.
But they had a field day calling the private lawyers names, commenting on their facial expressions and their overall physical appearance.
At one point, Escudero likewise commented in jest about Matib’s “demeanor” inside the court.
Senator-judges intensely scrutinized the business entities linked to the couple. Questions focused heavily on the couple's corporate finances, bank accounts, and foreign remittances to determine if they accumulated unexplained wealth.
Risa Hontiveros flagged what she considered “alarming foreign financial connections” involving Cale88 Foods Corp., a banana chips company owned by Carpio.
Hontiveros said the research done by her staff showed some of the funds remitted to Cale88 came from Chinese state-owned enterprises that may be "advancing the interests of the Chinese Communist Party."
She said that a Ukraine-based firm called Arkmen LLC, which remitted money to Cale88, was under criminal investigation in Ukraine for fraud and money laundering, raising the possibility that Cale88 was tied to money laundering activities.
Bam Aquino had asked about the lack of "economic justification" for large financial transactions entering Cale88 Foods Corp.
He asked Garcia-Marquez and previously the other witnesses about how millions of pesos—reportedly a total of P319 million originating from China and Hong Kong—were transferred into the company's accounts without proper or sufficient documentation.
On Day 36, he asked for a deeper look into whether the couple's Tapang at Malasakit Alliance foundation received unlawful donations from China.
Joel Villanueva raised red flags over the operational metrics of Cale88 Foods Corp. He questioned how it was possible for the corporation to report P150.8 million in sales and P11.4 million in expenses for 2024 while maintaining only two registered employees.
Erwin Tulfo pushed for transparency regarding the couple's revenue, actively questioning the other potential sources of income flowing into Cale88.
Senate President Sherwin Gatchalian recalled an SEC report showing that 10 out of 18 companies linked to the couple declared no dividends. Since these firms, such as Mati City Ice Plant and Cold Storage and SGT Fortune Horse Corporation, either declared no dividends or suffered financial losses, they could likely be ruled out as the source of the couple's massive net worth growth, he said.
Like Ferrer, Garcia-Marquez said the income and losses of these alleged companies were not the income or the losses of the couple.
'Suspicious' transactions
Garcia-Marquez and the day’s second witness, probably more appropriate to have been referred to as a resource person, lawyer Alexander Cabrera, provided the backdrop for another technically heavy hearing, this time not just the legalese, but on tax and SEC financial rules and regulations.
Cabrera is a certified public accountant, lawyer, and forensic financial analyst who serves as the Managing Partner of Cabrera & Company and Chairman Emeritus of PwC Philippines.
His so-called “financial analysis and forensic findings” were his mere opinion, as pointed out by Erwin.
Cabrera tried to plug some holes in the testimonies of an SEC witness official and a PhilGEPS executive, and Duterte’s brother, Davao City Mayor Sebastian Duterte, who all said that Duterte's name didn’t appear in GenCorp’s financial and contract records.
Cabrera said Duterte didn’t drop GenCorp in her SALN because the company was a “big one” owning five Jollibee branches in Davao.
Cabrera was a self-proclaimed financial analyst and forensic expert. Prosecutor Chel Diokno had recited a long litany of Cabrera’s credentials, from rags-to-riches, his schooling in the Philippine School of Business Administration for his business course, Ateneo for his law, and in Harvard and Wharton for further studies in finance, and his numerous trainings and advocacies.
It was so long that Escudero said in jest that Gatchalian was willing to vote for him in the next election. Enough of his credentials, said Erwin.
One netizen commented that Cabrera's life story was a tearjerker, enough to make for a good script for the popular TV show, Maalala Mo Kaya.
Cabrera disclosed that Carpio had issued to some of his associates, among them, Lourdes Lebosada: P11.35 million; Dexter Cicero Latayan, P9.6 million; Rafaelito N. Villavicencio, P6.7 million; Pedro Nino Lascano, P4 million; Deo Zambrano, P500,000; paid in cash, P23 million.
Lebosada is Sara's dentist as shown in Annex A. Latayan is the treasurer of Mati City Ice Plant and Cold Storage, Inc.
All the withdrawals were “suspicious,” he said, calling his findings an expert appreciation, or “sensitive calculation” of the transactions.
But what’s the value of his findings without any government official and any government documents certifying the same?
Cabrera tackled so many other things, but Escudero declared it was not binding for the court. All these were mere guides, he said.
Until then, that was his personal opinion, another said.
Lacson stood up, wondering how far Cabrera would go.
“If we criticized your findings later on,” said Lacson, “we would hurt your reputation and industry standing.”
Gaps in testimonies and documents remain
The trial is several weeks away from nearing a conclusion. No less than former Senate President Franklin Drilon, an impeachment veteran, said in a TV interview that the prosecution has finally found the smoking gun in the Duterte family’s alleged bank accounts.
So many people were probably ready to believe him and the prosecution. But there remain so many gaps and so many unreconciled testimonies and documents.
It didn't help when the prosecution lawyers kept on litigating outside the court, where they would issue statements recklessly calling Duterte guilty without addressing the gaps and unreconciled documents.
Can Sara Duterte explain her wealth, warts and all, as alleged by the prosecution?
In a press conference after the morning session, Rep. Paolo Ortega of La Union told newsmen that Ferrer’s cross-examination of Garcia-Marquez had turned circuitous and overly complex.
“Hindi nila maipaliwanag ang nakaw na yaman,” he said. “Ikot lang ng ikot.”
Ortega failed to say that the defense has yet to take its turn to present its own witnesses seeking to answer all that. As all lawyers have repeatedly pointed out, there is always the presumption of innocence.
Some statements for now are probably more believable if said in moderation.
Disclaimer: The views expressed in this article are those of the author and do not reflect the opinions of PhilSTAR L!fe, its parent company and affiliates, or its staff.
WATCH: Save for retirement or enjoy life now? (Generations Ep. 21)
September 16, 2026
WATCH: LGBTQIA+ people with unlikely professions
June 28, 2026