President's Message
Atty. Benedicta Du-Baladad Message from the President:

Benedicta Du-Baladad


To FINEX members and friends,

PRESIDENT’S REPORT
August 2017 Issue

Last July 19, Department of National Defense (DND) Undersecretary Cardozo Luna shared with us the security policies of the Duterte Administration amidst Marawi crisis and the Martial Law in Mindanao. Unfortunately, DND Secretary Delfin Lorenzana Jr. was not able to grace the event due to an emergency meeting that he has to attend.

Read more

2017 Year-Round Corporate Sponsors

PARTNERS :

DIAMOND :

GOLD :

Affiliations
Ads
Collateral damage
Print PDF
J. Albert GamboaBy J. Albert Gamboa

BUSINESS WORLD(FINEX Folio)
April 7, 2017

Collateral damage

FINEX Folio is a rotating column of members of the Financial Executives Institute of the Philippines appearing every Friday in BusinessWorld, opinion section.

Caught in the crossfire between the Bureau of Internal Revenue (BIR) and Mighty Corp. are thousands of legitimate retailers nationwide whose businesses are getting affected by the fake tax stamp scam embroiling the Bulacan-based cigarette manufacturer.

BIR Commissioner Caesar R. Dulay said the revenue agency will prioritize the filing of charges against Mighty, and any compromise settlement is still far from the BIR’s mind as cases are still being built up based on multiple raids conducted over the past two months.

The country’s chief revenue official explained that separate cases have to be filed following the series of raids, given the fact that each raid entailed different circumstances. He said: “You cannot compromise without a tax case, as far as the BIR is concerned.”

So far the only tax evasion case filed by the government’s top revenue generator with the Department of Justice involves a recent raid at Mighty’s warehouse in San Simon, Pampanga to the tune of P9.56 billion. According to Mr. Dulay, another raid in San Ildefonso, Bulacan yielded three times more confiscated cigarette packs and on the basis of that alone, they might file a P27 billion to P30 billion case.

Earlier raids in the cities of Zamboanga, Cebu, General Santos, and Tacloban also found counterfeit stamps affixed on Mighty’s products. All these have caused serious concerns among retailers, who are getting wary of accepting stocks since they may be prosecuted should they be caught with fake stamps.

Mere possession of items with counterfeit tax stamps is punishable under the law, and three retailers have reportedly been charged. For this reason, some sellers have started to refuse accepting products from the embattled firm. This is their only option left when in doubt about the cigarette packs, unless they want to get into trouble with the BIR.

In fairness to Mighty’s sales managers, they are now issuing certifications to individual retailers attesting to the authenticity of the products they distribute. The long arm of the law has finally caught up with them after enjoying a seemingly kid’s glove treatment from the previous administration.

To ensure the full cooperation of retailers, the BIR should issue guidelines regarding products emanating from Mighty’s distribution network. As for the compromise being proposed by President Rodrigo R. Duterte which is allowed under the National Internal Revenue Code, conditions should be set in place to prevent future abuses, including stiffer penalties for subsequent recurrence.

Mr. Dulay told reporters yesterday that the BIR is even considering the cancellation of Mighty’s license to operate. He said: “Because there was a violation of the Tax Code, we’re also looking into that.”

One of the measures he has already taken is the quarterly reshuffling of revenue officers on the premises of tobacco manufacturers. During the reign of his predecessor, former Commissioner Kim Jacinto-Henares, it took years before BIR officials were rotated, and those who were embedded in the organizations they monitored allegedly turned a blind eye when it came to shenanigans.

Since the single excise tax rate on the so-called sin products took effect last Jan. 1, pink-colored tax stamps have been affixed on cigarette packs. This makes it easier for regulators to immediately see if a product is authentic or not. Another way to closely monitor the daily operations of alcohol and tobacco companies is by seeing to it that machines stop production at the end of each day and resume operating the next business day.

A source from the banking industry has hinted that the embattled firm is now considered a high credit risk. “Pasikip ng pasikip na ang mundo nila,” he said.

Finance Secretary Carlos G. Dominguez III announced last week that the government would not give Mighty special treatment, saying: “The rule of law must be applied equally. All kinds of crime must face swift and sure justice, and Mighty is no exception. Those fraudulent tax stamps represent billions of pesos worth of theft from the Filipino people.”

He expressed confidence that strong evidence gathered by the BIR and the Bureau of Customs would pin down the company and “seems to overwhelmingly point to their guilt.” He assured Mighty executives that they “will have their constitutional opportunity to prove their innocence.

The opinions expressed here are the views of the writer and do not necessarily reflect the views and opinions of FINEX. The author is Chief Financial Officer of the Asian Center for Legal Excellence and serves as Co-Chairman of the FINEX Media Affairs Committee.

FEATURED ARTICLES
PH-OGP, The Philippine Open Government Partnership. Part 2
Santiago F. Dumlao Jr.By Santiago F. Dumlao Jr.

BUSINESS MIRROR (Free Enterprise)
September 22, 2017

PH-OGP, The Philippine Open Government Partnership. Part 2

Simply, we wish to bring to greater awareness this ongoing program that promises long-lasting positive influence to good governance in government, with the strong engagement of the private sector. Let the PH-OGP brochure say it in a capsule:

Read more...
Energy and infrastructure
Flor G. TarrielaBy Flor G. Tarriela

Business World (FINEX Folio)
September 22, 2017

Energy and infrastructure

At the successful 2 nd  Annual Philippines Energy and Infrastructure Forum held recently sponsored by PNB Capital, BPI Capital and PJS Law, topics included the Golden Age of Infrastructure, the new role of the Public-Private Partnership Center (PPPC), optimal financing strategies for energy and infrastructure projects, legal implications of the competition law on energy and infrastructure sectors, and the energy mix in the future.

Read more...
Outdoor advertising for MSMEs
J. Albert GamboaBy J. Albert Gamboa

MANILA TIMES(FINEX Files)
September 22, 2017

Outdoor advertising for MSMEs

Peace talks have collapsed between the Philippine government and the National Democratic Front-Communist Party of the Philippines-New People’s Army (NDF-CPP- NPA), with the Reds blaming President Rodrigo Duterte for the breakdown of negotiations.

Read more...
PH-OGP, The Philippine Open Government Partnership. Part 1.
Santiago F. Dumlao Jr.By Santiago F. Dumlao Jr.

BUSINESS MIRROR (Free Enterprise)
September 20, 2017

PH-OGP, The Philippine Open Government Partnership. Part 1.

Simply, we wish to bring to greater awareness this ongoing program that promises long-lasting positive influence to good governance in government, with the strong engagement of the private sector. Let the PH-OGP brochure say it in a capsule:

Read more...
Overstepping authority
J. Albert GamboaBy J. Albert Gamboa

MANILA BULLETIN(Business Option)
September 19, 2017

Overstepping authority

Business owners in major Philippine cities are in a quandary about the way their local government units (LGUs) are implementing President Rodrigo R. Duterte's Executive Order 26 that regulates smoking in enclosed public places and conveyances.

Read more...
Breaking barriers to competitiveness
J. Albert GamboaBy J. Albert Gamboa

BUSINESS WORLD(FINEX Folio)
September 15, 2017

Breaking barriers to competitiveness

The Financial Executives Institute of the Philippines (FINEX) will hold its 49th Annual Conference at the Fairmont Hotel in Makati City on Oct.13. Organized by the FINEX Week Committee, its theme is “Breaking Barriers to Competitiveness in the ASEAN Financial Sector” with the following rationale:

Read more...
Partners