Malacañang on Saturday welcomed the P49-billion settlement of tobacco company Mighty Corp.’s liabilities with the government.
In a statement, Palace spokesman Ernesto Abella noted that “unpaid taxes result in less government revenues and stall the delivery of quality government services.”
“This landmark tax settlement is the largest in Philippine history; and will go a long way in funding the Duterte administration’s infrastructure program,” Abella said.
He added that President Rodrigo Duterte would be “relentless in his campaign against corruption and delinquent taxpayers, haling violators to court, if necessary.”
“As citizens cooperate, we build a comfortable life for all. Strong political will to benefit all, and not just a few, should be the trademark of the entire government,” Abella added.
On Friday, the Department of Justice (DoJ) dismissed three tax evasion complaints against Mighty Corp. after the Bureau of Internal Revenue (BIR) decided to withdraw its charges.
In a joint resolution dated October 2 and made public on Friday, the DoJ approved the BIR’s motion to withdraw filed on September 26.
The Justice department’s decision came almost three months after President Duterte ordered the BIR and the Department of Finance to accept Mighty’s P25-billion tax settlement offer.
The BIR, in its plea, cited Section 204 of the National Internal Revenue Code (NIRC), which allows the Commissioner the power to “compromise, abate and refund, or credit taxes.”
“Complainant BIR referred to the approved settlement of Mighty Corporation’s excise tax as well as compromise
settlement of all its pending tax-related issues including that of its officers and shareholders,” the joint resolution stated.
“In view of the fact that the NIRC recognizes the authority of the Commissioner of the Bureau of Internal Revenue to compromise, abate and refund or credit taxes, and to compromise criminal violations except those already filed in court or those involving fraud, and considering further, that the parties to the instant are not opposed to the prayer for the withdrawal of the complaints, it behooves this Office to grant the motion if only to promote greater interest of the parties involved,” it added.
The BIR had filed three tax evasion complaints against Mighty and its top executives for a total of P37.9 billion in unpaid excise taxes for allegedly using fake tax stamps.
The tax settlement, Duterte said in his second State of the Nation Address, would be used to rehabilitate the war-torn Marawi City and Ormoc City, which was recently damaged by a 5.1-magnitude quake.