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GMA-7 heiress nagbirong naiinggit sa 'tax avoidance scheme' ng ABS-CBN

The daughter of bilyonaryo Felipe L. Gozon couldn’t help but dip her fingers into the hot issue concerning ABS-CBN Corp.’s crafty tax avoidance scheme percolating on social media.

The daughter of bilyonaryo Felipe L. Gozon couldn’t help but dip her fingers into the hot issue concerning ABS-CBN Corp.’s crafty tax avoidance scheme percolating on social media.

“Oh baka GMA can copy this too to avoid paying taxes hehe,” replied GMA Worldwide and Films president Annette Gozon-Valdes on a Facebook post by Willy Ramasola detailing how ABS-CBN “saved” on its tax payments through a little-known subsidiary registered with the Philippine Economic Zone Authority (PEZA).

“Seriously though. Maybe you have some auditor FB friends that can give their opinion? Pasado naman kasi ang scheme na ito sa auditor nila,” the Harvard-educated lawyer added.







Gozon-Valdes apparently is mindful of how GMA has been paying more taxes than the Lopez-owned media giant which is currently in limbo after its free TV and radio channels were yanked off the air a day after its fanchise expired on May 4.

In 2018, GMA paid P1.04 billion in taxes compared to ABS-CBN’s P421 million. In 2018, GMA paid P928 million while ABS-CBN had a negative income tax of P84 million.

So what’s this tax avoidance scheme which just landed on the inbox of several netizens, including actress Vivian Velez?


Basically, ABS-CBN uses Big Dipper as a tax shield to enjoy the latter’s tax perks, specifically a special tax rate of five percent versus the standard tax rate of 30 percent.

ABS-CBN and its foreign unit, ABS-CBN Global, separately pay service fees to Big Dipper for prepping their content for distribution.

Big Dipper gets services fees from ABS-CBN for “repurposing” its film library for digital distribution and from ABS-CBN Global for warehousing, storage. maintenance of ABS-CBN TV programs it owns for international distribution.

Without Big Dipper, ABS-CBN and ABS-CBN Global would have to pay the regular income tax.

In 2017, Big Dipper got P838 million service fees from ABS-CBN and P1.37 billion from ABS-CBN Global.

In the same year, Big Dipper remitted P2.5 billion in dividends to ABS-CBN, up 13 percent from P2.2 billion in 2016. These dividends are not subject to any tax.

What is Big Dipper?

Big Dipper Digital Content & Design Inc.is a 100 percent subsidiary of ABS-CBN based at the latter’s headquarters in Quezon City.

It was formed in 2000 but only started operations in 2009 when it was granted special tax perks as a PEZA-registered company with pioneer status as an information technology (IT) enterprise.

As a PEZA-registered firm, Based on its financial reports, Big Dipper’s only transactions appear to be solely with ABS-CBN and ABS Global. ABS-CBN Global’s biggest transactions are also with Big Dipper.

In December 2009, Big Dipper entered into a service agreement with the then newly-formed ABS-CBN Global wherein the former agreed to provide “archiving, digitization, warehousing, storage and maintenance of TV programs for transmission on digital media” to the latter.

ABS-CBN Gobal, formed in Hungary in 2009 and has a branch in Luxembourg, took over ABS-CBN International’s operations, specifically as the TV giant’s distribution in over 50 territories all over the world.

Big Dipper used to hold the film archives of ABS-CBN from 1986 to 2009 but it sold all its rights to this precious library to ABS-CBN Global in 2009 apparently as part of this tax avoidance scheme.

GMA-7 heiress nagbirong naiinggit sa 'tax avoidance scheme' ng ABS-CBN GMA-7 heiress nagbirong naiinggit sa 'tax avoidance scheme' ng ABS-CBN Reviewed by AsianPolicy.Press on 5:54:00 PM Rating: 5

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