Mighty tax story moves on

In a note posted on its website this morning, Japan Tobacco Inc indicated that it had not announced the information contained in a recent news story concerning JT’s ‘acquisition of assets from [Philippines-based] Mighty Corporation’ (MC).

It said it would make a further announcement ‘when appropriate’.

Quoting information from the Philippines’ Department of Finance, Cliff Venzon, writing yesterday for Nikkei, said JT had offered to buy MC and related assets for 45 billion pesos ($890 million).

‘The country’s Bureau of Internal Revenue in May said Mighty owed 37.88 billion pesos in taxes,’ Venzon wrote…

‘In a July 10 letter to bureau chief Cesar Dulay, Mighty president Oscar Barrientos offered to pay 25 billion pesos as a compromise.

‘Barrientos said the settlement would be funded by an “interim loan” from JT International Philippines and from the sale of business and assets of Mighty affiliates to JTI, according to the finance department, which oversees the tax bureau.

‘A JT representative in Tokyo said the acquisition talks are ongoing, while officials from Mighty were not immediately available for comment.’

Meanwhile, a story in The Philippine Star yesterday said MC had offered to settle its tax liabilities of P25 billion pesos through a loan and through proceeds of its sale to Japan Tobacco International Philippines.

“We are studying the offer,” finance secretary Carlos Dominguez III,” was quoted as saying in a statement.

Dominguez added that the settlement offer of the Bulacan-based manufacturer was separate from criminal charges the Bureau of Internal Revenue filed against the company.