DOF to heed Duterte order to settle with Mighty | Inquirer Business
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DOF to heed Duterte order to settle with Mighty

By: - Reporter / @bendeveraINQ
/ 05:14 AM July 26, 2017

The Department of Finance yesterday said it would heed the President’s order to accept homegrown cigarette firm Mighty Corp.’s proposed tax settlement of P25 billion.

“President Duterte’s acceptance of Mighty’s offer to settle its civil tax liabilities provides the Bureaus of Customs and of Internal Revenue (BIR) a strong impetus to run after other big fishes that continue to cheat the government of billions of pesos in taxes,” Finance Secretary Carlos G. Dominguez III said in a statement.

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Also, Dominguez said he “welcomes the President’s statement that the acceptance of the settlement does not preclude other criminal charges against Mighty that the BIR may decide to file against it.”

“As the President has pointed out, the civil settlement will spare us a long-drawn out court battle that could take years to resolve,” the Finance chief noted.

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In his State of the Nation Address last Monday, the President said that under the settlement to be shepherded by the DOF and the BIR, the Bulacan-based Mighty “will no longer engage in the tobacco business.”

Mighty is the second biggest cigarette firm in the country.

“This will be the biggest tax settlement on record. It will produce a windfall for government, which is significant, since we face the unexpected costs of rebuilding Marawi and Ormoc,” the President said. Marawi was flattened by the fighting between government forces and ISIS fighters while Ormoc suffered from a recent earthquake.

“Let this be a lesson to others—this administration will spare no one found cheating the government of its due,” the President warned.

The President said the DOF and the BIR were “strengthening tax administration and running after tax evaders.”

The BIR had filed before the Department of Justice three tax evasion cases against Mighty and its top executives for a total of P37.9 billion in unpaid excise taxes due to alleged use of fake tax stamps.

Last Friday, Dominguez said the government was expected to collect up to P30 billion, including value-added tax, from a potential settlement with Mighty.

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The tax settlement amount will be funded by the proceeds from the P45-billion sale of Mighty’s assets and distribution network to Japan Tobacco International Philippines.

Last week, the DOF through the BIR accepted a P3.44-billion initial payment from Mighty and JTI Philippines.

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TAGS: Carlos G. Dominguez III, Department of Finance, Mighty Corp., tax settlement
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