How the Bigs have fallen in stride: Mighty Corp., Phil Airlines settle tax liabilities


The might of Duterte’s political will is currently reaping huge financial benefits for the country.

Just recently, the Philippine government scored a major financing coup as they had two huge companies settle their tax liabilities to avoid the filing of cases against them in the Philippine courts.

Flag carrier Philippine Airlines (PAL) agreed to pay in full their Php 6-billion liabilities and obligations to the government incurred from the CAAP/MIAA services and navigational charges. Months of conciliation of their records has resulted in the settlement of the unpaid accounts to the government.

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The Department of Transportation lauded the efforts of the PAL leadership to keep their account with the government updated. In the joint statement released by both DOTr and PAL, both sides have exhausted all efforts to keep the records updated and have reached a resolution of the fees issue.

PAL has said repeatedly that it is willing to enter into a compromise deal with the government to ensure that its unpaid obligations would be settled accordingly. PAL has also said that its efforts to keep their slate clean is a sign that they fully trust and are confident in the Duterte administration, noting further that the flag carrier would continue to provide its airline operations to serve the Filipino people.

The settlement was reached a day before the end of the 10-day ultimatum issued by President Rodrigo Duterte himself for PAL to settle its due debts to the government.

Meanwhile, tobacco giant Mighty Corporation has also opened its purse strings to the tune of Php 40 billion to settle its own liabilities claims filed by the Bureau of Internal Revenue and the Department of Finance over the Department of Justice.

DOJ Secretary Vitaliano Aguirre confirmed that Mighty Corporation has indeed settled its obligations resulting in the withdrawal of the three tax evasion charges lined up against them.

A joint resolution dated October 2 approved the BIR’s motion to withdraw the charges filed on September 26. The decision came down nearly three months after the statement made by President Duterte to accept the initial offer of Mighty Corporation to settle its tax liabilities with a Php 25 billion tax settlement offer.

The BIR pointed out to Section 204 of the National Internal Revenue Code allowing the Commissioner to compromise, abate and refund or credit taxes depending on the case. The agreement came in response to the claim of the BIR that Mighty Corp., evaded the payment of excise taxes by allegedly using fake tax stamps. The allegations were among the basis for the filing of three tax evasion charges against Mighty Corp and the top level executives.

Duterte stated in his second State of the Nation Address that he would be coming after the tax evaders so that the taxes that would be collected would be used to rehabilitate war-torn Marawi City and earthquake hit Ormoc City which suffered the effects of a 5.1 magnitude tremblor.