Mighty Corporation is a Filipino corporation and was the second largest cigarette manufacturer in the Philippines from 2010 to 2017. On September 8, 2017, Japan Tobacco acquired Mighty Corporation's cigarette business in the amount of P46.8 billion, paving the way for the full payment of P30 billion to the Philippine government as part of the agreement for Mighty Corporation to settle its unpaid tax liabilities.
History
In 1945, the company was established as La Campana Fabrica de Tabacos, Inc. by Wong Chu King with a small cigarette factory in Manila producing a type of native cigarette known as "matamis". In 1948, a second factory was built in Barangay Olympia, Makati. In 1963, a facility for tobacco threshing and redrying was constructed in Malolos, Bulacan where the company's processing plant was later established. In 1985, the company changed its name to Mighty Corporation and acquired the trademarks of rival Alhambra Industries, Inc. in 1993. In 2001, the company entered into a cigarette manufacturing agreement with rival Sterling Tobacco Corporation to produce the latter’s brands. In 2004, the company entered into a cigarette manufacturing agreement with the Philip Morris Philippines as the latter had acquired the trademarks of Sterling Tobacco Corporation. The company increased its market share from 3 percent in 2012 to nearly 20 percent in 2013 as a result of consumer down-trading from premium to low-end brands. The company endured accusations by rival PMFTC since the implementation of Republic Act 10351, more commonly known as the "Sin Tax Law", in 2012. In 2014, the company was engaged in talks with British American Tobacco, the smallest player in the Philippine tobacco market, to explore partnership options. In 2017, Mighty Corporation completed the sale of its cigarette business to Japan Tobacco in the amount of P46.8 billion. The transaction included the company's trademarks, intellectual properties, sales and distribution network, manufacturing equipment and inventories. It also resulted to the domestic manufacturer's tax payment amounting to P40-billion pesos - the largest amount paid in Philippine history by any corporation. The proceeds were to be used to boost the Duterte administration's infrastructure program.
Since the implementation of Republic Act 10351, Philip Morris International and PMFTC Inc. accused Mighty Corporation of various issues yet no formal charges or complaint have been filed while the Bureau of Internal Revenue has clarified to maintain a neutral position in the ongoing tobacco trade war. BIR Commissioner Kim Jacinto-Henares officially stated that "the burden of proof rests on PMI and PMFTC, they should prove that Mighty Corporation has evaded the government. If they cannot prove their allegation, then they may be liable for libel or slander." She said PMI’s current hurdles in the Philippine market could have been avoided if PMFTC agreed to the government’s original proposal of adopting a unitary tax system, which aimed to remove the tax rate gap between low- and high-priced cigarette brands. The BIR chief explained a unitary rate system on cigarette could have been prevented smokers from down-shifting from high-priced brands, such as Marlboro, Winston and Lucky Strike, to low-priced brands, like Mighty.
Allegations of using fake excise tax stamps
Mighty Corporation allegedly used fake tax stamps on cigarette packs, after Bureau of Customs conducted raids on its warehouses. Using taggant readers, they scanned and confiscated cigarette packs with alleged fake excise tax stamps on in San Simon, Pampanga last March 2017but the company denied the allegations, stating that the confiscated cigarettes used officially issued tax stamps.
Social involvement
Mighty Corporation is engaged in corporate-social responsibility work through the Wong Chu King Foundation, Inc.. As devout Catholics, the Wong Chu King family has been active in various educational and apostolic programs together with local churches in helping communities all over the Philippines since its inception. In 2014, WCKFI also launched a two-pronged community outreach program geared towards tobacco farmers and their families as an effort to save the local tobacco industry. The first one is the allocation of a P10-million peso budget to help modernize tobacco farmers that have no access to modern farming and irrigation equipment as well as a college scholarship program to aide 200 sons and daughters of tobacco farmers across two regions.
