Del Monte denies tax irregularities

MANILA, Philippines - Del Monte Pacific Ltd. (DMPL), the Asian food conglomerate, said its Philippine unit, Del Monte Philippines Inc. (DMPI) was not involved in tax irregularities as alleged in a plunder complaint filed against Bureau of Internal Revenue (BIR) commissioner Caesar Dulay and other BIR officials.

In a filing with the Philippine Stock Exchange (PSE), DMPL said the Philippine subsidiary has been operating in the Philippines for 93 years and has been diligently paying its taxes.

It said the tax assessments supposedly contained in the plunder complaint were absurd.

DMPI supposedly had tax assessments totalling to P30 billion from 2011, 2012 to 2013.

“It was mentioned that DMPI was assessed P21 billion in 2011, P3.43 billion in 2012 and P5.2 billion in 2013. These assessments appear outrageous when compared to DMPI’s revenues during those years,” DMPL said.

DMPI’s revenues for those years amounted to P16.8 billion in 2011, P18.5 billion in 2012 and P19.8 billion in 2013.

Furthermore, DMPL said the correct taxable income for the three-year period amounts to P678.3 million for 2011, P1.56 billion for 2012 and P1.83 billion for 2013.

Based on the amounts, the income tax paid by DMPI amounted to P236 million for 2011, P408.9 million for 2012 and P534.9 million for 2013.

DMPI is ready to cooperate with any government agency.

According to the allegations, DMPI was issued an assessment notice amounting to P21 billion for the taxable year 2011.

However, when Dulay came into office, he allegedly ordered a reduction of the tax due to P14.99 billion and which was supposedly paid to the BIR last February.

Furthermore, for taxable year 2012, Del Monte was assessed P3.43 billion, but was allowed to pay only P20 million and in 2013, the tax due was allegedly also reduced to P30.3 million from P5.2 billion.

Thus, out of the P30 billion assessment for years 2011, 2012 and 2013, Del Monte was allowed to pay only P65.4 million, according to the plunder complaint.

Dulay will issue a statement this week to clarify the matter. 

DMPL, for its part, has said the company continues to invest in new products to grow the business.

It continues to execute its strategy based on innovation and differentiation, which is supported by strong merchandising and targeted marketing.

Investments in new products and brand building will continue to be made in response to consumer demands and to secure a long-term growing and profitable business.

Sales in the Philippine market were softer in the fourth quarter while the group continues to maintain a healthy market share across the majority of its key categories.