Nonsecure stamp-tax printers allow counterfeiters to earn P15 billion

The Bureau of Internal Revenue (BIR) vowed on Tuesday to capitalize on new technologies and improve the security features on its excise-stamp tax to stop the widespread use of fake stamps that rob the government of up to P15 billion each year.

Fake excise stamps are particularly rampant in cigarette manufacturing, in part because the machines that print them, while government-owned, are commercially available everywhere and therefore quite easy for anyone to simulate and make money for themselves.

BIR Deputy Commissioner Jesus Clint O. Aranas said the government needs to step up the security features on its excise-tax stamps and upgrade their printing machines so that counterfeiters are unable to copy them.

“Well, the presumption is the fake tax stamps do not come from APO Production Unit Inc. They are printed outside. That is why we are trying to improve the security features because the printers APO is using are not secure. They are available on the commercial market and many others have this kind of commercial printing machines,” Aranas told financial reporters.

When or how the agency only belatedly realized that their printing machines are unsafe have not been adequately explained, but Aranas acknowledged the adoption of technological advancements will help secure the excise-tax stamps going forward.

This means changing the ink, as well as the tap guns used for the printing of the excise-tax stamps, among other countermeasures.

“We have to improve the kind of printing that we are producing, the ink that we are using, the tag guns that we are using. There are so much [new] technology already in the market,” he said.

The BIR also said it  is looking into the apparent breach in the printing process that Aranas said originated from the lack of enforcement measures at the bureau and to the lack in manpower, as well.

“We need to revisit it. Obviously, we have a problem with the fake stamps [and] that means our security has been breached somehow, and that enforcement is lacking. Of course, we lack the manpower also,” Aranas said.

Improving the security features on the tax stamps is a priority at the BIR so as not to allow counterfeiters to defeat the changes that will be made.

“We are looking into new designs right now but, of course, the security features are something that we have to improve on. We cannot be doing the same thing that we did the last time because, then, the counterfeiters will just adopt. And then again repeat the process and then we’ll have to change again,” Aranas emphasized.

He quickly added they are also looking into cheaper ways of ramping up the security features so as to address issues raised by tobacco manufacturers, saying that improvements mean added costs for the industry.

“What we’re looking at right now are less costly increases in security features so that the market will not be [adversely] affected,” Aranas said.