Mighty Corporation asks DOJ to junk P26.93-B tax evasion raps

Embattled cigarette maker Mighty Corporation and its officials asked the Department of Justice (DOJ) on Thursday to dismiss the P26.93-billion tax evasion complaint against them by the Bureau of Internal Revenue (BIR) over alleged use of fake tax stamps.

Mighty Corporation Vice President for External Affairs and Assistant Corporate Secretary Alex Wongchuking attended the preliminary investigation hearing, where he filed his counter affidavit with the DOJ panel of prosecutors.

Other respondents Mighty President and former Armed Forces Deputy Chief of Staff Edilberto Adan, Executive Vice President and retired Judge Oscar Barrientos and Treasurer Ernesto Victa also submitted their written defense to the charges.

The complaint arose from raid on Mighty’s warehouses in San Ildefonso, Bulacan on March 24 which yielded billions of pesos worth of cigarettes with fake stamps.

“Basically the search that was done was illegal. There was no legal justification for it. The evidence that was obtained is doubtful,” said Abraham Espejo, legal counsel for Wongchuking after the hearing, which was off limits to media.

“If the evidence is obtained illegally, it’s inadmissible (in court). Not only is the evidence inadmissible, it’s also questionable,” he added.

Mighty officials also urged the DOJ to consolidate the three tax evasion cases since they stemmed from the same allegation about the use of fake tax stamps on its cigarette products.

The DOJ had already finished hearing the P9.56-billion tax complaint in relation to the raid on four warehouses in San Isidro, Pampanga.

The company is also facing a P1.39-billion tax complaint stemming from the government raid on the company’s warehouse in Barangay Lagao, General Santos City on March 24.

The third complaint brings to P37.884 billion its alleged tax dues to the government. —KG, GMA News

Source: http://www.msn.com/en-ph/money/topstories/mighty-corporation-asks-doj-to-junk-p2693-b-tax-evasion-raps/ar-BBCh4St?li=BBr8Mkm

 

Mighty Corporation pleads innocence before Doj on tax evasion case

A LAWYER of embattled local cigarette firm Mighty Corp. maintained his clients’ innocence in the P26.93-billion tax-evasion complaint before state prosecutors on Thursday.

 
The Department of Justice (DoJ) yesterday held its first preliminary investigation on the second of three tax evasion raps filed by the Bureau of Internal Revenue (BIR) against Mighty Corp.

Members of the media were barred from covering the hearing, but Abraham Espejo, representing Mighty Corp., told reporters outside the hearing: “They have not committed any crime that they are being pilloried. Give us a chance to be heard. That’s my request.”

“I assure you that my clients will be able to prove that all of these accusations are not true,” Mr. Espejo added.

Mr. Espejo represents the four respondents in the case, namely: Mighty Corp. President Edilberto P. Adan, Executive Vice-President Oscar P. Barrientos, Vice-President for External Affairs and Assistant Corporate Secretary Alexander D. Wongchuking, and Treasurer Ernesto A. Victa.

The lawyer said that their camp filed a counter-affidavit with annexes reaching to “thousand” of pages. “Kaya kami nagfa-file ng (That is why we are filing the) counter-affidavit, we want due process. We do not want kangaroo-style proceedings here. I reiterate, we will fight,” Mr. Espejo also said.

Asked how he thinks the case is proceeding, he replied that the case is “doubtful, questionable, as a student of constitutional law, you will know the effect if evidence is obtained illegally, it’s inadmissible. Not only is the evidence inadmissible, it’s also questionable.”

He added that the case “could be due to business rivalry,” but did not elaborate.

The BIR first filed the tax evasion case worth P9.56 billion against Mighty Corp. on March 22. The BIR, in a statement released upon filing, said: “[t]he respondent corporation was the subject of an on-the-spot surveillance operation of untaxed cigarette products conducted [last March 1]… in San Simon Industrial Park (SSIP), San Isidro, Pampanga” and that random checks on 10 master cases of cigarettes in four warehouses in the economic zone leased by Mighty showed that internal revenue stamps affixed on the cigarette packs “were fake.”

Subsequent inventory of all cigarette packs in the warehouses concerned showed that Mighty stored there 66,281 master cases with 33,140,500 cigarette packs.

“The investigation further showed that 87.5% of the said packs bore fake internal revenue stamps,” the BIR said.

“The stamps are fake since they did not contain one of the multi-layered security features of a valid internal revenue stamp,” the BIR added.

The said case was deemed submitted for resolution last May 30.

Mighty Corp. is also facing a third complaint from the BIR, worth P1.39 billion. The three complaints bring the total alleged tax liabilities of Mighty Corp. to P37.88 billion — the largest tax evasion case so far under the administration of President Rodrigo R. Duterte.

The case is handled by a three-man panel of state prosecutors led by Senior Assistant State Prosecutor Sebastian Caponong, Jr. The other members are Assistant State Prosecutors Ma. Lourdes Uy and Mary Ann Parong. — Kristine Joy V. Patag

 
http://www.bworldonline.com/content.php?section=Nation&title=mighty-corp.-pleads-innocence-before-doj&id=146480

Mighty Corporation on producing cigarettes

Mighty Corp., one of the country’s local producers of low-priced cigarettes, announced it will buy 10 million kilograms of tobacco products worth millions of pesos from farmers in Northern Luzon and elsewhere in the country.

Mighty executive vice president Oscar Barrientos said in an official letter of intent to National Tobacco Administration administrator Edgardo Zaragoza it would buy tobacco from farmers 100 percent more than the five million kilograms his firm bought in 2013.

“This is to assure our tobacco farmers of our willingness to help in response to the published report of the market leader in the tobacco industry to lessen production this year,” Barrientos, a retired regional trial court judge, said.

The letter of intent, in effect, debunked critics’ allegations that MC has been importing raw materials from foreign countries at low prices and is no longer buying tobacco from local farmers.

Barrientos said the critics had been resorting to a disinformation campaign using convoluted data in an effort to undermine Mighty’s tremendous increase of its market shares.

MC’s market shares surged to almost 20 percent of the low-priced cigarette brands last year from in 2012, resulting in the payment P8.2 billion in excise taxes.

Barrientos said the company’s market shares shot up after the government effectively implemented Republic Act 10352, or the Sin Tax Law, that leveled the playing field in the multibillion-peso tobacco industry which was controlled by Philip Morris and Fortune Tobacco.

The new law that took 14 years to pass and certified as urgent by President Aquino III caused a tremendous migration of smokers from the expensive premium and sub-premium brands to low-priced cigarettes.

It also resulted in some smokers, because of economic reason, to simply quit the vice and thus validated health authorities’ estimate that the sin tax law would result in the decrease of the number of smokers in the country.

 

 

 

 

 

Mighty Corporation continuing helping the needy thru educational assistance

 

For the past several years, wholly Filipino owned company Mighty Corporation continued their programs thru their CSR arm, Wong Chu King Foundation’s (WCKF) educational assistance. It consists of 100 college scholarship grants, to poor but deserving students who are children of tobacco farmers in Northern Luzon.

“Formal schooling is often too expensive and priced well beyond the reach of the poor, including tobacco farmers,” Adan, a retired general said. He added that scholarship program is one of three components of a P10-million joint CSR project of Mighty Corporation (MC) and the National Federation of Tobacco Farmers and Cooperatives Inc. (NAFTAC) that aims to benefit 65,000 farmers in Pangasinan, La Union, Abra, Cagayan, Isabela, Ilocos Norte and Ilocos Sur.

“This is our way of thanking the farmers for helping to make our company what it is today,” said Adan at the formal signing rites for the project at a hotel in Bauang,             La Union last February 8, 2014.

“We are happy that Mighty Corporation, through its Wong Chu King Foundation, has stood firm on its commitment to help 65,000 tobacco farmers in the Philippines,” said Mario Cabasal, NAFTAC national president.

Retired judge Oscar Barrientos, MC executive vice president and spokesman, said the WCKF initially offered scholarships to the dependents of active MC employees but later expanded this to include dependents of retired MC employees and poor but deserving students with excellent academic records.

“Through this program, we hope to help the farmers and their children become competitive in the global market and earn sustainable incomes,” Barrientos said.

The scholarship program is in support of the National Tobacco Administration’s scholarship program for poor but deserving graduating high school students and dependents of tobacco farmers.

Other components of the project include agricultural production assistance, consisting of 16 hand tractors worth P2.5 million and 90 irrigation pumps worth P1.1 million; and institutional support for the annual search for outstanding tobacco farmers and cooperatives by the National Tobacco Administration (NTA).

Mighty Corp double up their tobacco purchase

A cigarette manufacturing company announced it would double its purchase of tobacco from five million to 10 million kilos this year, which would boost the income of farmers in the area, the president of the National Federation of Tobacco Farmers Association and Cooperatives (NAFTAC) said.

NAFTAC president Mario Cabasal said the announcement of Mighty Corp was expected to break the farmers’ dependence on giant tobacco companies, who enter into contract with farmers to make them plant high nicotine varieties.

“The farmers now have a buyer for low-grade tobacco,” Cabasal said.

Mighty Corporation, a Filipino company, produces low-priced brand of cigarettes, which are popular among the masses. The company provided farmers 83 units of water pumps and 16 hand tractors.

The company also sponsored 100 college scholarship for children of tobacco farmers in La Union. It signed partnership agreements with farmers at the Hotel Ariana in Bauang, La Union last February 8.

Mighty Executive Vice President Oscar Barrientos said the company will compete with the giant tobacco companies in the purchase of tobacco, which they needed as cigarette filler.

Edgardo Zaragosa, Administrator of the National Tobacco Administration, welcomed the entry of Mighty Corporation in the market, “which is good because competition in tobacco trading will help farmers, especially if the price is right.”

“If Mighty is absent, we will be having problems selling tobacco,” Zaragosa said.

 

Mighty Corp bought tons of tobacco leaves in Northern Luzon

Mighty Corp., one of the country’s local producers of low-priced cigarettes, announced it will buy 10 million kilograms of tobacco products worth millions of pesos from farmers in Northern Luzon and elsewhere in the country.

Mighty executive vice president Oscar Barrientos said in an official letter of intent to National Tobacco Administration administrator Edgardo Zaragoza it would buy tobacco from farmers 100 percent more than the five million kilograms his firm bought in 2013.

“This is to assure our tobacco farmers of our willingness to help in response to the published report of the market leader in the tobacco industry to lessen production this year,” Barrientos, a retired regional trial court judge, said.

The letter of intent, in effect, debunked critics’ allegations that MC has been importing raw materials from foreign countries at low prices and is no longer buying tobacco from local farmers.

Barrientos said the critics had been resorting to a disinformation campaign using convoluted data in an effort to undermine Mighty’s tremendous increase of its market shares.

MC’s market shares surged to almost 20 percent of the low-priced cigarette brands last year from in 2012, resulting in the payment P8.2 billion in excise taxes.

Barrientos said the company’s market shares shot up after the government effectively implemented Republic Act 10352, or the Sin Tax Law, that leveled the playing field in the multibillion-peso tobacco industry which was controlled by Philip Morris and Fortune Tobacco.

The new law that took 14 years to pass and certified as urgent by President Aquino III caused a tremendous migration of smokers from the expensive premium and sub-premium brands to low-priced cigarettes.

It also resulted in some smokers, because of economic reason, to simply quit the vice and thus validated health authorities’ estimate that the sin tax law would result in the decrease of the number of smokers in the country.

 

Mighty Corp’s CSR arm build churches

The Wong Chu King Foundation (WCKF), a non-government organization of Mighty Corp that supports education in its projects and programs, is funding the construction of the Sacred Heart Chapel of the Senior High School Building for Xavier School in San Juan City.

The chapel will be dedicated “in loving memory of the friendship” of Mr. Wong Chu King, patriarch of the family that formed WCKF, and Jesuit priests Jean Desautels and Ismael Zuloaga.

According to Caesar Wongchuking, WCKF vice president, the Sacred Heart Chapel of Xavier School’s senior high school building is being built “in line with the cause and passion for education of my father, our family patriarch.”

Wong Chu King was one of the school’s founding donors. Fr. Desautels, a French-Canadian Jesuit, was one of the school’s founders and its first president and director. Fr. Zuloaga was the school’s longest-serving president and director at 19 years, from 1966 to 1985. The school is named after St. Francis Xavier, one of the first leaders of Jesuit missions in China.

“Fr. Desautels went door-to-door in Manila for donations to buy the land needed to set up the school,” the WCKF vice president recalled.  “At 3:30 pm on December 15, 1955, Fr. Desautels closed the deal and purchased the land barely an hour and a half before the 5 p.m. deadline agreed on with the seller of the land on which the school was eventually built.”

“All of us, my siblings and I, graduated from Xavier School and imbibed the Jesuit’s God, education and service-centered mission,” he added.

“This project is our way of honoring our father’s friendship with the Jesuit community and paying forward for the excellent education we received from the school,” said Alex Wongchuking, WCKF executive director and Caesar’s elder brother.

Signing the deed of donation are Marietta Wongchuking- Co Chien, WCKF Director; Johnip Cua, Xavier School chairman of the board of trustees; and Fr. Aristotle Dy, school president and director.

The foundation is also financing the schooling of hundreds of poor but deserving students all over the country.

Mighty Corp gave scholarships to the needy

Formal schooling is often too expensive and priced well beyond the reach of the poor, including tobacco farmers. Thus, the Wong Chu King Foundation (WCKF) is offering 100 college scholarship grants to poor but deserving children of tobacco farmers in Northern Luzon.

The program is one of three components of a P10-million joint project of Mighty Corp. (MC) and the National Federation of Tobacco Farmers and Cooperatives Inc. (NAFTAC) that aims to benefit 65,000 farmers in Pangasinan, La Union, Abra, Cagayan, Isabela, Ilocos Norte and Ilocos Sur.

The WCKF is the corporate social responsibility arm of MC, which the Wong Chu King family owns. “This is our way of thanking the farmers for helping to make our company what it is today,” said retired general Edilberto Adan, MC president and chief executive officer, at the formal signing rites for the project at a hotel in Bauang, La Union on February 8.

“We are happy that Mighty Corp., through its Wong Chu King Foundation, has stood firm on its commitment to help 65,000 tobacco farmers in the Philippines,” said Mario Cabasal, NAFTAC national president, at the signing, attended by top MC executives and 200 farmer leaders.

Retired Judge Oscar Barrientos, MC executive vice president and spokesman, said the WCKF initially offered scholarships to the dependents of active MC employees but later expanded this to include dependents of retired MC employees and poor but deserving students with excellent academic records.

Other components of the project include agricultural production assistance, consisting of 16 hand tractors worth P2.5 million and 90 irrigation pumps worth P1.1 million; and institutional support for the annual search for outstanding tobacco farmers and cooperatives by the National Tobacco Administration.

The foundation has six high school and 14 college students on scholarship in various schools nationwide. Two of its college scholars graduated last year.

WCKF also donated P300,000 for textbooks and other library materials of Lyceum de Amulung in Cagayan North, Tuguegarao City last year. In 2012, it provided textbooks, laboratory and home economics equipment to Lyceum de Amulung and teaching devices to Lyceum de Amulung’s teachers.

At last, we finally get to hear some good news from Bureau of Internal Revenue (BIR) Commissioner Kim Henares.
Earlier this month, the BIR commissioner, known for running after lowly taxpayers, has issued her findings favoring local tobacco manufacturing firm, Mighty Corp. over tobacco giant foreign entity Philip Morris-Fortune Tobacco Corp. (PMFTC).
In her agency’s findings, Henares ruled out the alleged cigarette smuggling activities being attributed by PMFTC against Mighty saying there exist no such wrongdoing in the Philippine tobacco industry.
Mighty Corp., a Bulacan-based cigarette manufacturer, became a subject of accusations that they are involved in technical smuggling, tax evasion and all other possible crimes, which its accuser claim, has enabled Mighty to sell its tobacco products at a very low prices, as low as P16 per stick pack.
However, Henares 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.
Based on reports, Mighty was able to gain a remarkable 20 percent of the country’s smoking consumers from three percent last year, while industry leader and foreign entity PMFTC holds 75 percent from a strong 92 percent before January 2013.
But Wongchuking family-owned and proud Filipino company has 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, saying imputing fraud against them was “unfair but highly libelous and damaging” as the BIR and Customs authorities have been closely monitoring their operations, reporting and compliance. In spite of this, they have 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.
Of course, Henares has to refute PMFTC’s allegations.
For if what PMFTC has been accusing Mighty of is true, then how come it has asked the BIR to reclassify four of its Marlboro cigarette brands as low-priced tobacco products in an apparent bid to reclaim its market share from Mighty?
According to sources, PMFTC has already introduced its low-priced Marlboro cigarettes in Mindanao, selling it at P1 per stick.
So the question, if PMFTC claims Mighty cannot sell cigarettes at P16 per pack or P0.80 a stick without resorting to technical smuggling and underdeclaration, then how can it do the same without also resorting to such illegal acts?
While we expect PMFTC to deny any illegality in its undertaking and claim claim it can sell low-priced cigarettes without violating any law, so can Mighty Corp.
So, would PMFTC pursue its quest for Congress to probe Mighty Corp. for alleged technical smuggling and underdeclaration?
According to Kabataan Representative Terry Ridon, PMFTC cannot come to Congress with unclean hands if it insists Mighty is resorting to illegal acts while it could also been doing the same lately.
And Congress insiders bare the House committee on ways and means would start its hearing on the tobacco issue sometime in the middle of next month.
And PMFTC has to contend with Henares’ adverse findings against it when Congress compels them to prove their allegations against Mighty.
At least Kim is siding with lowly Filipino taxpayers this time.

 

Filipino-owned tobacco firm Mighty Corp turned 70 years

 

Local cigarette manufacturer Mighty Corp. said it will donate tobacco dust, a fish pond conditioner that protects local ponds from predators, to help millions of Filipino fish pond owners and operators as well as tobacco farmers nationwide.

“We are going to help the National Tobacco Administration promote the use of tobacco dust by donating to our thousands of fish pond owners and operators all over the country,” Mighty Corp. executive vice president Oscar Barrientos said in a statement.

“In doing so, we are helping both tobacco farmers and fish pond owners and operators increase their yield,” he said, adding the company previously sold tobacco dust to fish pond owners and operators.

Barrientos said the NTA was promoting tobacco dust to control the population of snails and other fish pond predators, as this was “an effective and economic option to replace highly toxic and cyanide-based chemicals used in the preparation or sterilization of fishponds.”

He said the cigarette company aimed to increase the income of the tobacco-growing industry by buying 10 million tobacco leaves from local farmers all over the country.  It allotted P700,000 for the purchase of green leaves.

The NTA manufactures Tobacco Dust Plus at a plant in Sto. Tomas, La Union, where leaves are re-dried and pulverized.

The dust promotes the growth of lablab, an algae and natural fish food, and serves as pond floor conditioner. Pond owners and operators use it to prepare or sterilize fish ponds before stocking fingerlings there.

Fish stocking is the practice of raising fish in a hatchery and releasing them into a river, lake, or the ocean to supplement existing population, or to create a population where none exists.

Studies by a team from the Southeast Asian Fisheries Development Center in Tigbauan, Iloilo under Joebert Toledo had confirmed the tobacco dust efficacy.

Other studies headed by the government agency showed promising results from the use of tobacco dust as a substitute to chemical fish pond fertilizers.

Mighty aims to help local tobacco farmers earn more with a projected increase in the production of tobacco leaves and tobacco dust while helping pond owners and operators and the environment as well.