Philip Morris Fortune Tobacco Corp. To Pursue All Opportunities vs Smuggling

Source from:  Manila Bulletin 12/01/2014

Dominant player Philip Morris Fortune Tobacco Corp. (PMFTC), Inc. said it will continue to pursue every opportunity to denounce the wrongdoings of some cigarette manufacturers in the local market, the company said.

On the sidelines of the recent Bright Leaf Journalism Awards, Paul Riley, PMFTC president, told reporters that the company will be "relentless" in its campaign against unscrupulous cigarette companies engaged in illicit trade.

But when asked if PMFTC is willing to bring its allegations against one local tobacco company to courts, Riley said "that's really the government's responsibility."

"We're not the ones that are losing from undeclared tax," Riley said, but the government. He, however, admitted "we're the ones suffering from it because that [tax] should be put into prices."

PMFTC, the local unit of tobacco giant Philip Morris International and Lucio Tan's Fortune Tobacco, recently took its allegations of fraudulent acts against rival Mighty Corp. to major broadsheets through a series of full-color paid advertisements.

In one of its paid ads, which had the words "Mighty Corp. Exposed," PMFTC showed alleged government data to accuse the Bulacan-based firm of misdeclaring its production through comparison of its export and domestic production with other manufacturers combined.

"We will be relentless until something is done and we'll pursue every opportunity, every avenue to make sure everyone pays the tax. We will be absolutely relentless until that happens because we have no choice," Riley said.

"You may find more [advertisement] materials coming in," he added.

But the Bureau of Internal Revenue (BIR) has already belied a Philip Morris-funded report alleging the fast-rising illegal cigarette trade in the country, instead the agency highlighted the "overwhelming" growth in its sin tax collection.

"The growth in collections on sin taxes disproves the allegations that the government is losing revenues through illicit trade," the BIR said, citing the P101 billion in excise taxes from sin products in 2013, which was 81 percent higher compared with 2012.

Likewise, the BIR said for the first three quarters of 2014, total collections reached P78.3 billion, higher by 21 percent against the P64.5 billion target for the period.

The BIR then said the International Tax and Investment Center and Oxford Economics report, which alleged that of the 105.5 billion cigarettes locally sold in 2013, 18.1 percent was attributable to illicit consumption was incomplete and lacks proper attribution as to source. Enditem