Cigarette manufacturer Mighty Corp.’s settlement of its tax obligations will help the government address unexpected costs arising from a series of natural calamities, a Cabinet official said.
President Rodrigo Duterte last month ordered the Finance department and the Bureau of Internal Revenue to accept Mighty’s settlement offer of P25 billion, which Finance Secretary Carlos Dominguez 3rd said would go up to P30 billion from taxes on the company’s sale to Japan Tobacco International (JTI) Philippines.
“This will be the largest sum of taxes collected ever from a single taxpayer in Philippine history. It brings windfall revenues for government during a time when calamities inflicted unexpected spending burdens for the government,” Dominguez said during a briefing by the Development Budget Coordination Committee for the Senate Finance Committee.
Mighty’s sale is also expected to increase sin tax collections by P1 billion a month, which can be used to improve health care facilities and enable the Health department to procure additional medicines and provide services that will help prevent and control tobacco-related diseases.
A first tranche of P3.4 billion was paid by Mighty last July 20.
Full collection of the remainder, said Dominguez, will depend on how swift the Philippine Competition Commission approves the sale of Mighty to JTI.