Philippines: Lawmaker Urges House To Probe Tobacco Smuggling

Source from:  Sun Star 11/14/2014

A PARTY-LIST lawmaker urged Wednesday members of the House of Representative to conduct an inquiry on the alleged smuggling of tobacco products into the country.

AAMBIS-Owa Party-list Representative Sharon Garin said that the government has been losing some P15.6 billion pesos in revenue annually in the illegal smuggling operations of tobacco products.

Garin filed House Resolution 1542 directing the House committee on ways and means to conduct an inquiry to ensure that the government properly collects the revenues from tobacco products.

A report published by Oxford Economic and International Tax and Investment Center indicated that 19.1 billion illicit cigarettes were consumed in the country in 2013 thus posing a question if the Sin Tax Law is being implemented correctly.

Garin noted that both the Oxford study and cigarette company Philip Morris cited that the consumption of domestic illegal tobacco nearly tripled from 6.1 billion in 2012 to 17.1 billion last year. This influx of illegal tobacco in the country have been causing the government to lose P15.6 billion annually.

"It is an obligation of the Philippine Congress to formulate measures to eliminate tobacco smuggling in order to protect the health of all Filipinos and the interest of tobacco farmers as established by the Sin Tax Law," Garin said.

The National Tobacco Administration says tobacco industry employs an estimate of 1.9 million Filipinos, 43,960 of which are tobacco farmers.

The 2009 Global Adult Tobacco Survey, verified by the Philippine Statistics Authority, indicates that 28 percent or 17.3 million Filipino adults age 15 years and older are current tobacco smokers.

The Bureau of Internal Revenue (BIR) has verified that the sin tax law has been instrumental in boosting government revenue. From January to June 2014, collection from the sin taxes stood at P45.99 billion, P11.34 billion of which are taxes from cigarettes.

The BIR has recently implemented the use of Internal Revenue Stamp Integrated System imposing the affixture of Internal Revenue Stamps on both imported and locally produced cigarettes designed to further improve the collection of tobacco tax and toughen the agency's capacity to fight smuggling of tobacco products.

"The government could generate more income if the tobacco smuggling will be curbed that is why congress should use its oversight function to check if amendments to Sin Tax Reform Law is in order or if the BIR is doing all the right moves to ensure that revenues are not lost," Garin said. Enditem