BIR not taking side in cigarette industry allegations

birlogoIn the midst of the many issues that the Bureau of Internal Revenue (BIR) is facing these days, from the high-profile cases filed against celebrities to their new implemented rules, the agency’s statement regarding its neutral stand in the ongoing controversy in the Philippine tobacco industry was a welcome to smaller players like Mighty Corporation.

The Bulacan-based Mighty Corp said that a survey allegedly commissioned by the giant cigarette manufacturer Philip Morris  Fortune Tob@cco Corporation (PMFTC) is  picturing them as unscrupulous enterprise. Oscar Barientos, a retired judge and Mighty Corp executive vice president, said that this is unfair and malicious to discredit and to kill all local brands.

A BIR tax fraud official who declined to be named said in an earlier report that they are not taking side over foreign company PMFTC and Filipino-owned Mighty Corporation (MC), producer of low-priced cigarettes which was accused of alleged tax evasion, smuggling  and other trade malpractices by a foreign research firm.

The said official assured, “We have not received any derogatory confidential information against MC other than what we read in newspapers on the results of the survey conducted by AC Nielsen.”

Barrientos said, “Mighty is not selling at a loss and is gaining profit as evidenced by the more than P5.4 billion income and business tax payments to the BIR during the first nine months of the year, which payment is expected to rise to P8 billion by the end of the year.”

He is also happy to share that the local cigarette manufacturer owned by the Wongchuking family would like to emphasize that it was untrue that it was selling its products at a loss to gain more patronage and eat up the low income clientele of PMTC which now control 94 percent of the cigarette market.

It was reported that a foreign-dominated monopoly is geared towards promoting mid-market brands since profit margins in the low-cost category are low. This way, it said local brands will be faced out to favor expensive brands which is not align in promoting a healthy business competition that in end will benefit the consumers.

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