Philip Morris fined B1.22bn

Philip Morris fined B1.22bn

Court finds tobacco giant guilty of evading import duty

Gerald Margolis, managing director of Philip Morris (Thailand) Ltd, speaks to reporters after the Criminal Court fined the company for 1.22 billion baht for evasion of cigarette import duty. (Photo by Apichart Jinakul)
Gerald Margolis, managing director of Philip Morris (Thailand) Ltd, speaks to reporters after the Criminal Court fined the company for 1.22 billion baht for evasion of cigarette import duty. (Photo by Apichart Jinakul)

Criminal Court fines the Thai subsidiary of US tobacco giant Philip Morris 1.22-billion-baht for evading duty on cigarettes imported from the Philippines over a decade ago.

On Jan 18, 2016, public prosecutors told the court that PMTL made 272 false declarations on the prices of Marlboro and L&M cigarettes it imported from the Philippines from July 28, 2003 to June 24, 2006.

The declarations did not reflect the actual prices of the products and were intended to evade paying the full duty. The actual prices plus the avoided duty were estimated at 20.21 billion baht.

Prosecutors said the company declared a value of 5.88 baht for a packet of L&M cigarettes, while other cigarette importers declared 16.81 baht per packet.

PMTL also declared the Cost, Insurance and Freight (CIF) rate on Marlboro cigarettes from the Philippines at 7.76 baht a packet, lower than the 27.46 baht reported by other importers.

The company and its seven employees were defendants and the people were released on bail of 1 million baht each. All defendants showed up to hear the ruling.

While convicting and fining the company in its ruling delivered on Friday, the court acquitted its local employees, finding that they had nothing to do with the price declarations, which were prepared in the United States.

PMTL managing-director Gerald Margolis said the company would appeal.


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