The Bureau of Internal Revenue (BIR) has ramped up its efforts to combat illicit tobacco products by issuing an updated list of registered manufacturers, importers, and exporters dealing in cigarettes, heated tobacco products, novel tobacco products, and vapor products.
BIR Commissioner Romeo Lumagui Jr. issued Revenue Memorandum Circular No. 93-2023, requiring all manufacturers, importers, and exporters to register the various brands and variants of their tobacco-related products within a strict six-month window or face the consequences of potential penalties.
This move follows the BIR’s decision in May to raise the floor price of cigarettes to P114.60 per pack, a significant increase from the P82.49 recorded in June. Selling tobacco products below this mandated floor price not only poses financial risks but can also lead to tax evasion charges.
Such sales suggest that the requisite P60 excise tax and the P12.28 value-added tax have not been appropriately remitted.
As of September 14, BIR’s investigation showed that the Lazada e-commerce platform still hosts vendors offering cigarettes at prices below the BIR’s stipulated floor price.
One such merchant, operating under the name “sari-sari store 2023,” was selling a ream of cigarettes branded as “modern” and labeled as “for export only” for a mere P420, equivalent to just P42 per pack. This same merchant was found to be offering other cigarette brands below the BIR floor price, including RGD, Double Dragon Red Cotton, Two Moon, Carnival Blue, and Vess Menthol Cotton.
On Lazada, another merchant capitalized on the platform’s “Sulit Sweldo sale” by selling a ream of cigarettes for only P355. These cigarettes, under the J&J, HotJoy, and Muse brands, came out to just P35.50 per pack, plus shipping charges.
Lumagui reiterated the importance of adhering to graphic health warning regulations and affixing BIR tax stamps on tobacco products, with the exception of vapor and novel tobacco products. The absence of internal revenue stamps for these products in the system means they are currently exempt from this requirement.