DOF chief: No deal with Mighty

The tax evasion case being readied against Mighty Corp. will definitely push through while the government computes all of the homegrown cigarette manufacturer’s unpaid taxes for using fake tax stamps, Finance Secretary Carlos G. Dominguez III said yesterday.

The Department of Finance also yesterday asked Chinese business magnate Jack Ma to stop selling counterfeit Philippine cigarette tax stamps on the website of e-commerce giant Alibaba.

“The case [against Mighty] will push through. We will file a case because it’s our duty,” Dominguez told reporters on the sidelines of a tax reform forum hosted by the Philippine Chamber of Commerce and Industry.

President Duterte on Thursday said the government might instead settle with Mighty if the cigarette firm would pay P3-5 billion. But Dominguez said “there will be no settlement.”

The Finance chief said that the DOF as well as the bureaus of Customs and of Internal Revenue have yet to determine Mighty’s total unpaid excise taxes, although he said in a speech that it could be at least P5 billion.

Nongovernment Action for Economic Reforms said in a statement Friday that Mighty’s tax liabilities could run up to P15 billion based on the volume of cigarette packs that bore fake stamps earlier confiscated by the BOC and the BIR in Zamboanga, Pampanga, General Santos City, Cebu and Tacloban City.

“We’re still counting. We’re having a bit of counting,” Dominguez said, citing that Mighty’s lawyers were “obstructing” the investigation of the BOC and the BIR.

“According to Billy Dulay, there was a troop of lawyers from Mighty objecting to what the BIR wanted to do,” Dominguez added, referring to Internal Revenue Commissioner Caesar R. Dulay.

“But we’re going to be determined to get the [total] amount [of Mighty’s liabilities]. We’re moving quickly to lift the TRO (temporary restraining order) [obtained by Mighty against the BOC]. We have discussed it with the executive secretary and the justice secretary. We will [contest it] up to the Supreme Court,” Dominguez said.

In case Mighty wants to pursue a settlement, Dominguez said the company must first talk to him as well as Dulay and Customs Commissioner Nicanor E. Faeldon.

To address the proliferation of fake cigarette tax stamps, Dominguez also yesterday wrote a letter to Ma to call the Chinese businessman’s attention with regards the sale of such stamps on alibaba.com.

“It has come to our attention that the selling of digitally printed fake cigarette tax stamps is currently being advertised in Alibaba.com. We would like to respectfully request that Alibaba cooperate with the government of the Republic of the Philippines by immediately stopping such advertisement and prohibiting similar advertisements in the future,” Dominguez said in his March 10 letter to Ma, who chairs the Alibaba Group.

A copy provided by the DOF to reporters showed that Chinese Ambassador Zhao Jianhua was furnished a copy of Dominguez’s letter to Ma.

“Following the directive of the President, the Philippine government, especially through the BIR and the BOC, is very much active in pursuing individuals and entities evading taxes and duties, including excise tax levied on cigarettes. Advertising and selling of fake tax stamps in the open, through your company’s web portal, provides so much room and easy access for individuals and entities to evade excise tax on cigarettes in the Philippines. Consequently, this will make it much more difficult for the said bureaus to curb excise tax evasion, and cigarette and fake tax stamp smuggling to our country,” Dominguez told Ma.