Pres. Duterte Accepts Mighty’s P25-B Tax Payment, Biggest Tax Settlement On Record
President Rodrigo Duterte directed the Department of Finance
(DOF) and the Bureau of Internal Revenue (BIR) on Monday, July 24 to accept the
P25 billion tax settlement offered by local cigarette maker Mighty Corp.
“I have directed the DOF and the BIR to accept Mighty
Corporation’s offer of P25 billion to settle its tax liabilities,” President
Duterte said in his second State of the Nation Address (SONA).
Three tax cases filed by the BIR against Mighty are pending
before the Department of Justice.
The cases cover the company’s non-payment of excise taxes
due on its cigarette products and the use of counterfeit tax stamps on its
cigarette packs, which correspond to excise taxes amounting to P37.88 billion.
Despite the deal, the President said Mighty will no longer
engage in the tobacco business.
“This will be the biggest tax settlement on record. It will
produce a windfall for the government, which is significant since we have to
face the unexpected costs of rebuilding Marawi and Ormoc,” he said.
President Duterte also stressed that the acceptance of the
tax settlement offer does not preclude other criminal charges against the
company, which the BIR may file later.
“A settlement will allow the government to avoid a long
court battle that, as we saw in previous years, could take years to resolve.
Let this be a lesson to others. This administration will spare no one found
cheating the government of its due,” he said.
In an earlier statement, the DOF said the government’s full
collection of Mighty Corp.’s civil settlement of its tax liabilities will
depend on how swiftly the anti-trust body Philippine Competition Commission
approves the sale of the local cigarette maker’s assets to JT International
Philippines (JTI).
Meanwhile, Finance Secretary Carlos Dominguez III has said
Mighty’s offer to settle its tax liabilities for P25 billion will rise to about
P30 billion once the value-added tax (VAT) and other fees are included in the
computation of the final settlement sum.
Pres. Duterte Accepts Mighty’s P25-B Tax Payment, Biggest Tax Settlement On Record
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July 26, 2017
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