Abra: Abra lone district Rep. JB Bernos has called on the government to conduct a stronger crackdown on the sale of counterfeit or smuggled cigarettes to protect the local tobacco industry. ‘Ang mga peke at smuggled na sigarilyo ay malaking banta sa ating mga tobacco farmers, hindi lamang dito sa Abra, kundi sa buong bansa (Fake and smuggled cigarettes are a big threat to our tobacco farmers, not just in Abra, but in the whole country),’ Bernos said in a statement on Tuesday.
According to Philippines News Agency, a study by Stratbase Research and Intelligence found that illicit cigarettes continue to proliferate, reaching 9.52 billion sticks in 2022. It is projected to increase to 11.13 billion sticks by the end of this year. Meanwhile, the Bureau of Customs reported that PHP13.2 billion of the PHP114.8 billion worth of smuggled goods from 2019 to 2023 were illicit cigarettes and tobacco products.
Bernos highlighted the role that excise taxes on tobacco play in funding health programs, and how much funding would be lost by the rampant availability of untaxed tobacco products. The 2023 Sin Tax Annual Report of the Department of Health showed that 58 percent of excise tax collections for 2021 applied in the 2023 General Appropriations Act were derived from tobacco, amounting to PHP174.13 billion.
By law, excise tax collections from tobacco and heated tobacco products, alcohol, and sugar-sweetened beverages are earmarked for funding the implementation of universal health care, medical assistance, and the Health Facilities Enhancement Program. Bernos said local farmers further benefit from excise taxes as tobacco-producing provinces receive 5 percent, or about PHP4 billion, for producing burley and native tobacco, and 15 percent, or about PHP17 billion, for Virginia tobacco, which are to be used exclusively for programs promoting economically viable alternatives for tobacco farmers and workers.
‘But since illicit tobacco products are sold for much cheaper, tobacco farmers are being forced to lower their prices to remain competitive,’ he said. ‘The tragedy is that in their efforts to remain competitive, their livelihood is put into greater risk because of the reduced profitability of their produce,’ he added.
Bernos also appealed to sari-sari store owners to refrain from selling fake or smuggled cigarettes to help stem the problem. He also reminded them that selling fake or smuggled cigarettes is punishable by law. The National Tobacco Administration (NTA) recently announced that store owners who sell illicit tobacco could be slapped with fines ranging from PHP50,000 to PHP200,000. They could also face imprisonment of two to five years for trademark infringement.
The NTA added that retailers found selling products without the required tax stamps may face five to eight years in prison, while stocking cigarettes without graphic health warnings could result in fines of up to PHP100,000 and a one-year prison term.
