spot_img
29 C
Philippines
Thursday, March 28, 2024

Cigarette firm accused of ‘sabotage’

- Advertisement -

PRESIDENT Rodrigo Duterte on Tuesday ordered the arrest of Mighty Corp. president Alexander Wong Chu King, owner of the country’s oldest cigarette manufacturer for a potential P1-billion “economic sabotage” case stemming from the alleged use of counterfeit tax stamps. 

Speaking to reporters, Duterte also admitted turning down two separate bribery attempts from Wong Chu King when he was still Davao mayor. 

“Yes, I ordered his arrest … He’s the one behind it, the fake cigarette stamps,” Duterte told reporters on the sidelines of an Agriculture Department event in Malacañang.

“It’s not just a matter of not following the tax laws, but it’s also falsification,” he added. 

During the last Cabinet meeting Monday, the President recalled to Cabinet officials that the business tycoon tried to offer him guns and a package of cash, which he ordered to be returned.

- Advertisement -

The first attempt, the President said, was in a form of a gift when he was still Davao mayor. 

“When my aide looked at it, it was cash. I told him to catch up with that idiot. So he chased him to the airplane in Davao,” Duterte said in Filipino.

“There was a Christmas gift. It was a gun last Christmas. I did not accept it when I was mayor,” the President said, recalling a recent attempt. “But he asked for a favor. I said I’m not into it.” 

Rumors earlier circulated that a group of Mindanao lawmakers tried to bribe the President on behalf of a tobacco firm that had been implicated in tax evasion and smuggling. 

Duterte allegedly reprimanded them for the attempt and ordered the arrest of the owner of the tobacco company, reports said.

“He told us that there was this money from, the Wong[chuking]… owner of Mighty,” Chief Presidential Legal Counsel Salvador Panelo said. 

Wong Chu King turned himself to National Bureau of Investigation officials on Tuesday after Justice Secretary Vitaliano Aguirre II and the Bureau of Internal Revenue ordered his arrest. The NBI did not immediately disclose the agenda of the meeting.

NO SMOKE SIGNS? Mighty Corp. owner Alex Wong Chu King (in white and beside former NBI deputy director Reynaldo Esmeralda), the businessman President Duterte has ordered arrested,  arrives at the NBI headquarters to show, according to his counsel, he wants to cooperate fully with the government. Norman Cruz

Wong Chu King’s lawyer Siegfred Fortun said his client will not be arrested as no complaint has been filed yet against the cigarette manufacturer and the latter appeared at the DoJ only to speak with Aguirre concerning his alleged violation of tax laws.

“[We met with Aguirre] because of information that was conveyed to us that the President wanted to find out what had happened to the excise tax stamps, allegedly fake,” he said.

Fortun said that his clients have already expressed willingness “to cooperate and pay taxes based on BIR assessments found both accurate and fair.” 

At the same time, Fortun denied any attempt by the company to offer bribes.

“Mighty has never taken part nor has it ever indulged in such activity especially with officers of the incumbent administration,” he said.

He added that it “was plain that the information on the matter as disclosed by Presidential Legal Counsel Salvador Panelo is wrong.”

“Secretary Panelo is a victim of misinformation hence he has unwittingly disparaged Mighty who has no connection to that bribe incident that occurred several years back,” the lawyer said.

Authorities had earlier discovered in a raid last week some P2 billion worth of cigarette products of cigarette brand Mighty as well as another product, Marvel, supposedly with counterfeit tax stamps. 

Mighty, the oldest cigarette maker in the country, catapulted to second place in domestic cigarette retailing, competing with market leader Philip Morris Fortune Tobacco Corp. (PMFTC) as a result of a toughened sin tax law in 2012. 

PMFTC accuses Mighty of technical smuggling for selling its cigarettes at a much lower price, even if it was paying the higher taxes that the new sin tax law had dictated.

In a statement, Mighty blamed the BIR’s malfunctioning taggant excise stamp validating devices for producing varying results in products that were seized in last Thursday’s raid on its warehouses in San Simon, Pampanga.

Fortun declared that when the devices were used by BIR examiners on the confiscated cartons bearing Mighty cigarettes, “they registered a green light indicating they were genuine stamps and, later, registered red or bogus marks for stamps in the same carton.”

“In the same inspection proceedings conducted by joint teams from the BIR’s regional office in Pampanga and head office personnel, the devices either malfunctioned or could not read the tax stamps, thereby leading Fortun to conclude that they were unreliable for purposes of assessing Mighty’s liability for tax fraud or deficiency in excise tax payments,” the Mighty statement said.

“Worse, when the same device was used to test tax stamps on products of its competitors brought in by one of the agents, the device also turned red indicating that the competitors stamps were fake,” it added. 

Fortun said that the BIR should also sue and send notices of tax assessment to Mighty’s competitors. 

The Presidential Communications Operations Office, which controls the government printer Asian Productivity Organization Production Unit, Inc., denied that it was the one that produced the fake stamps that were found on the smuggled cigarettes

“It was not the APO who made the fake tax stamps,” PCOO Assistant Secretary Michael Kristian Ablan said, adding that production of tax stamps was highly supervised by the Bureau of Internal Revenue. 

APO Production, Inc. Chairman and Chief Executive Michael DJ Dalumpines, however, said that the proliferation of fake cigarette tax stamps in the market remains “a serious concern” for the government printer. 

“The Asian Productivity Organization (APO) Production Unit Inc., a registered government printer and attached agency of the Presidential Communications Operations Office (PCOO), is working closely with the Bureau of Internal Revenue (BIR) to investigate the matter,” Dalumpines said. 

The government last July launched an investigation into the overprinting of tax seals for cigarettes and liquor that were allegedly used by smugglers to sell contraband in the local market.

APO is one of the three designated printers of all accountable forms of the government.

- Advertisement -

LATEST NEWS

Popular Articles