The Department of Finance (DOF) said the destruction of cigarettes bearing counterfeit tax stamps from Mighty Corp. siezed earlier in the year will be destoyed in batches, with the first 5 million packs worth P142.44 million destroyed over the weekend.
According to the DOF, government officials led the destruction of the first batch of cigarettes bearing the brands sold by Mighty Corp. seized in Mindanao with the counterfeit tax stamps.
The cigarettes were destroyed through Holcim Philippines’s Geocycle Coprocessing facilities, which is a waste-management system employing a safe and secure method of waste management that destroys hazardous items while capturing its mineral content.
The Mighty Corp. cigarettes were seized on March 6 in a joint operation by a composite team from the Bureaus of Internal Revenue (BIR) and of Customs (BOC) at a warehouse leased to Mighty Corp. in General Santos City.
According to Holcim Philippines, the method ensures total thermal destruction of waste materials, reduce toxic gas emissions, as well as land and groundwater pollution.
The BIR and the BOC have stepped up their joint search and seizure operations against illicit cigarettes and other products in line with President Duterte’s all-out drive against smuggling and tax evasion.
“The decision to destroy these confiscated cigarettes came easily. We imposed sin taxes on these products in part to protect the health of our people. It would be wrong to release these products to the market,” Finance Secretary Carlos G. Dominguez III said.
Dominguez said the destruction of the seized cigarettes was intended to deliver the message the government will not let-up in its drive to catch companies that fail to pay proper duties and taxes to the government.
Some 9,496 mastercases or 4,748,000 packs of cigarettes of Mighty Menthol 100s, Marvels Menthol, Marvels FK and King Full Flavor brands were destroyed beginning last Sunday, at the Holcim Philippines Inc. Geocycle compound in
Bunawan, Davao City.
According to the BIR, the estimated deficiency excise tax liability of the seized cigarettes, including penalties, would have amounted to P1.39 billion.
The destruction all 4,748,000 million packs will take place in batches because of their enormous quantity, further underscoring the scale of tax fraud attempted by the erring firm. About 8 tons of cigarettes per day will be destroyed,
according to the DOF.
Apart from this batch, the government is also set to destroy 66,245 cases of Mighty Corp. cigarettes confiscated in San Simon, Pampanga; another 163,183 cases in San Ildefonso, Bulacan and other smaller stockpiles confiscated in
Tacloban and Cebu.
The complaints against Mighty Corp. had since been withdrawn after the company, with main headquarters in Bulacan, offered in July to settle its tax liabilities with the government for P25 billion and shut down its operations.
Mighty Corp. subsequently sold its assets to Japan Tobacco International Inc. to help pay off its tax arrears.