Finance Secretary Carlos Dominguez III commended Wednesday the Bureau of Internal Revenue (BIR) under the leadership of Commissioner Caesar Dulay for its “assiduous investigative work” and “decisive action” against cigarette manufacturer Mighty Corporation, which has led to the largest tax settlement made by a single entity in the country’s history.

On the occasion of the BIR’s 113th anniversary, Dominguez told officials and employees of the agency that he looks forward to more accomplishments similar to the case of Mighty Corp., which has offered to settle its tax liabilities for a whopping P25 billion, exclusive of value-added tax charges, and to leave the cigarette business altogether.

Mighty Corp. thrived during the past administrations but was exposed for its fraudulent practice of using counterfeit cigarette tax stamps less than a year into the Duterte presidency after a series of operations done by the BIR and the Bureau of Customs (BOC) against the company.

“Please accept my warmest commendations for the great work the Bureau has done in the case of Mighty Corporation. Assiduous investigative work and effective enforcement broke what could be the biggest instance of tax fraud in our country,” Dominguez said during the BIR’s anniversary celebration held at its head office in Quezon City.

Dominguez said the criminal cases filed by the BIR against Mighty before the Department of Justice (DOJ) had forced the firm to sell off its assets to Japan Tobacco International (JTI) in order to meet its tax deficiencies.

Mighty’s settlement offer of P25 billion will balloon to P30 billion once the Value Added Tax (VAT) on the sale of its assets to JTI, estimated at P5 billion, is collected by the BIR, Dominguez had said in earlier forums.

“President Rodrigo Duterte ordered us to accept the settlement offer, producing a revenue windfall. This, again, is the largest tax settlement in our history,” Dominguez said.

He said the “beauty of the settlement” lies in the fact that as a consequence of being forced to sell its assets, Mighty would be permanently out of the cigarette business.

“As a result of the BIR’s decisive action against Mighty, we now expect revenues from sin taxes to increase by P1 billion a month. Congratulations, again, for that,” Dominguez said.

“I look forward to more accomplishments similar to the cases of Mighty Corporation. These accomplishments highlight the vigilance and professionalism of the BIR,” he added.

The finance chief said that while “cigarette manufacturing has always been a troublesome sector as far as collecting proper taxes is concerned” he expects this to become a “smaller problem in the future” because of the new tools for surveillance and documentation of tax payments to be employed by the BIR to help run after tax cheats.

“At the moment, we are collecting more sin taxes than projected. This is a good sign. It is a tribute to the men and women of our revenue agencies. Remember that much of the money collected in sin taxes goes to improving health services for the country’s poor,” Dominguez said.

He said the public now places high expectations on the government’s revenue agencies as the Duterte administration embarks on its twin goal of massively spending on infrastructure and social services over the medium term to realize its vision of dramatically lowering poverty incidence among Filipinos.

This unprecedented spending on infrastructure, Dominguez said, aims to bring the economy on the par with the Philippines’ neighbors in the region, improve the efficiency of moving people and goods, attract investments and create more jobs.

“Improving revenue flows is the lynchpin to this bold and visionary strategy. Those inflows will ensure a stable fiscal position even as we pump-prime the economy through investments in vital infra projects. Ensuring robust revenue inflows is a patriotic duty,” Dominguez said.

He said ensuring robust revenue flows would require improve tax administration, which is currently being done at the BIR and BOC, and introducing a tax reform program –the Tax Reform for Acceleration and Inclusion (TRAIN) bill–that is now pending in the Congress.

“I am aware of the great challenges our revenue agencies face and the institutional remedies we need to put in place. Raising revenues is never easy ,” he said. “There are temptations that could weaken our professional commitment. ”

“We need to be constantly aware the nation depends so much on how well we do our jobs,” Dominguez added.