BIR Commissioner Downplays Mighty Corporation Tax Evasion Allegations

The Bureau of Internal Revenue (BIR) was quick to downplay the allegations against Filipino owned tobacco manufacturer Mighty Corporation of cigarette smuggling activities in the country is untrue. BIR Commissioner Kim Henares already ruled out such wrongdoing in the Philippine tobacco industry.

BIR Commissioner Downplays Mighty Corporation Tax Evasion Allegations

Mighty Corporation went under scrutiny and was tagged in technical smuggling, tax evasion and all other possible crimes. However, the bureau lady chief said that tobacco companies were just being aggressive in seizing market shares from big industry players since the enactment of the new excise tax regime last January.

Commissioner Kim Henares explained further that the situation with a simple and logical statement that if a company is selling at a loss, it is not the governemnt’s problem because there’s no such a law that prohibits selling at a loss. 

“But it’s not sustainable, and we don’t know how long it can be sustained.” as Henares clarifies.

As per the report, Mighty Corporation was able to gain a remarkable 20% of the smoking consumers from 3% last year, while industry leader and foreign entity Philip Morris-Fortune Tobacco Corp. (PMFTC) is at 75% from a dominant 92% before January 2013.

Wongchuking family, owner of the Filinpino owned and controlled corporation, has also denied all the allegations of smuggling or any form of illegal business practices thrown at them by competitors and critics, saying the company managed to lower its operational cost as it does not pay royalty to foreign headquarters and has no foreign consultants.

Mighty Corporation believes that throwing allegations of fraud against Mighty was “unfair but highly libelous and damaging” as the BIR and Customs authorities have been closely monitoring their operations, reporting and compliance. 

Amid the controversy, Mighty assured the public that they are open to government’s plan to examine its books along with its competitors to ensure proper compliance of all tobacco industry players with the new Sin Tax Law.