The Department of Finance (DOF) is eyeing other cigarette manufacturers perhaps equally guilty of fraudulent practices that allow them to dodge paying the correct tax to the government.
In a news briefing, DOF Assistant Secretary Paola Sherina A. Alvarez said the DOF is keeping tabs on other cigarette manufacturers, as well after filing a third complaint against homegrown tobacco firm Mighty Corp. last week.
The third complaint filed by the Bureau of Internal Revenue against Mighty Corp. cited an aggregate estimated deficiency excise-tax liability of P1.39 billion. The second complaint involved P26.93 billion while the first complaint, P9.5 billion. The third complaint resulted from Bureau of Customs (BOC) personnel entering the Sunshine Corn Mill Warehouse in General Santos City in March and leased to Mighty Corp.
The operation resulted in the apprehension and detention of 11 master cases and three reams from loose stocks from which cigarette packs were randomly tested to be spurious. “We are looking at not just one, but all cigarette companies, or other establishments, that are not paying taxes. So we want this to be a fair game for everyone. We want to ensure that those who are paying the correct amount of taxes are not disadvantaged and we will do this by running after those who are not,” Alvarez said.
Tax evasion deprives the government of revenues that could be used to improve health and education programs, among other services.
The Department of Health (DOH) fully supports the DOF’s campaign against tobacco-tax cheats who deprive the government of billions of pesos in revenues that could, otherwise, help fund initiatives to procure medicines and treat Filipinos most affected by smoking-related diseases.
“The DOH and the DOF mutually stress that the ‘sin’ tax reform law, also known as Republic Act 10351, which collects funds from the excise tax charged on tobacco products, is a prime directive to sustain the universal health-care program of the government in executing health-centered priority programs, especially to the destitute sectors of our society,” Ubial said.
According to Ubial, each additional P1-billion increase in excise-tax collection from the cigarette industry under the sin tax-reform law would enable the health department to treat 3.8 million patients afflicted with hypercholesterolemia; 471,437 insulin dependent diabetics; 27,768 children being treated for cancer; 6,568 breast-cancer patients; 33,333 stroke patients; 256,147 mental-health patients; and 14,059 patients under treatment for colon cancer and rectum cancer.“The estimated cost of paying for the medicine of the poor is about P14 billion for 2017. The sin tax allows the DOH to utilize revenue for the Medicine Access Program [MAP] that provides expensive medicines to indigent Filipinos. The DOH program also distributes oral maintenance medicines to 1,157,563 hypertension patients and to 441,642 patients being treated for diabetes,” she added.She said another P1 billion pumped into the MAP would allow the DOH to extend medical attention to 3.9 million individuals with hypertension and 1.7 million patients with diabetes.
Apart from the DOH, the Department of Education (DepEd) has also joined the DOF’s campaign against Mighty Corp., whose estimated tax liabilities could, according to education officials, feed 4.4 million school children or help close the perennial backlog in classrooms, teachers and learning materials in the public school system.
DepEd Secretary Leonor M. Briones said in the first complaint alone involving P9.5 billion in unpaid taxes, the government could have built 7,600 classrooms for elementary and junior high-school students, or 3,800 buildings for senior high-school students.
The same amount could have also helped feed 4.4 million school kids for 120 days under the DepEd’s school-based feeding program addressing undernutrition and short-term hunger among public-school learners from kindergarten to the sixth grade. The same could also have procured computer packages for 3,800 public schools or set up 3,800 science laboratories.