Finance Secretary Carlos Dominguez III said the government stands to gain almost P40 billion in additional revenues from the “sin tax” on tobacco products starting in 2018, following the move by Mighty Corp. to settle its tax liabilities and sell its assets to global firm Japan Tobacco Inc.
Dominguez, citing preliminary computations done by the DoF and the Bureau of Internal Revenue, said JTI would pay a minimum of P3.1 billion a month starting January 2018, or about P2 billion more per month than what Mighty had been paying.
“For fiscal year 2018, JTI is expected to pay almost P40 billion out of the estimated P118 billion in total excise tax collections on tobacco products,” Dominguez said in a statement. The amount represents a third of the total revenue collections from the excise tax on cigarettes.
Mighty Corp. which had faced a string of criminal complaints filed by the BIR before the Department of Justice for its use of counterfeit tax stamps offered in July to settle its tax liabilities for P25 billion and shutter its business. The Bulacan-based cigarette manufacturer sold its assets to JTI to pay off its tax dues.