Law controlling tobacco goods seen to aid government regain income

THE enactment of a law declaring the smuggling of cigarettes and other tobacco-related products as economic sabotage would allow the government to regain lost revenues of at least P25 billion annually, an industry group said.

The Fight Illicit Trade (FIT) and the Federation of Philippine Industries (FPI) lauded the third and final reading approval by the House of Representatives on House Bill (HB) 3917.

HB 3917 seeks to recognize cigarettes and other tobacco-related products as commodities covered by the Republic Act (RA) 10845 or the Anti-Agricultural Smuggling Act.

At present, RA 10845 only covers large-scale agricultural smuggling as economic sabotage when it involves sugar, corn, pork, poultry, garlic, onion, carrots, fish and cruciferous vegetables.

“The approval of House Bill 3917 is a welcome development in this time that the country is in much need of revenues due to a somehow cash trapped economy,” Jesus Arranza, chairman of FPI and head of FIT, was quoted in a statement as saying.

Arranza estimated that the government loses at least P24.75 billion in revenues annually due to smuggled cigarettes in the country.

Citing Euromonitor figures, Arranza added there are about 9 billion cigarette sticks smuggled in the country annually. Bulk of the smuggled cigarettes are found and openly sold in Mindanao, he said.

“In Lanao Del Norte alone the amount of illicit cigarettes is as high as 74 percent of total sticks sold,” he said.

The House of Representatives approved on third and final reading HB 3917 recently with 225 affirmative votes and no dissenting vote.

HB 3917 modified the provisions on jail term and penalties providing that violators face an imprison term of 30 to 40 years and a fine twice the fair value and the aggregate amount of the taxes, duties and other unpaid charges of smuggled items.

FIT also urged the government to intensify its efforts against illicit trade in general as the country loses P250 billion in revenues annually.

Arranza emphasized that smuggling has nearly or totally killed local industries citing the case of glass manufacturing, textile, steel, tire, palm oil, among others.


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