ILLICIT tobacco trade in the country may continue to prosper despite the proposed Anti-Agricultural Economic Sabotage Act as it has “insufficient” provisions to curb smuggling of the commodity, Sin Tax Coalition (STC) said.
The non-government group argued that tobacco, in the first place, should not have been included in Senate Bill (SB) 2432 (Anti-Agricultural Economic Sabotage Act) since it is not “essential to food security.”
What should have been done by lawmakers, the organization pointed out, was to draft and file a separate bill addressing the smuggling of tobacco products in the country.
That way, the legislative measure would have enough teeth to address the intricacies of illicit tobacco trade and “avoid illegal infirmities.”
“We are one with the government’s intent to seriously address illicit tobacco trade in the country. However, it would be most ideal for the illicit trade of tobacco products, especially manufactured tobacco products, to be tackled in a separate measure to avoid legal infirmities,” read the statement the group issued last Monday.
“Tobacco, after all, is not essential to food security, which is the main focus of RA 10845,” the STC said citing the recent case of Department of Health v. Philippine Tobacco Institute (GR 200431).
In that case, the Supreme Court reiterated that tobacco is a hazardous product [that] affects public health and requires regulation, the organization explained.
The organization claims that SB 2432 must be “enhanced” to “sufficiently” address illicit tobacco trade in the country. For one, the group argued that the current form of the proposed legislative measure, which relies “heavily” on deterrence through stiffer penalties, is “insufficient” to curb tobacco smuggling.
The STC emphasized that a track-and-trace system would be the “most effective” measure in curbing illicit tobacco trade. The system involves real-time recording and monitoring of the movement of tobacco throughout its entire value chain, according to the group.
The system, according to the STC, is aligned with the World Health Organization Framework Convention on Tobacco Control (WHO FCTC) Illicit Trade Protocol. The group proposed that the Bureau of Internal Revenue should be the one overseeing the track-and-trace system.
“A track-and-trace system would be more effective if it ran atop a licensing regime, such as that implemented under the Food and Drug Administration, to ensure effective regulatory capture of legally manufactured and imported tobacco products,” it said.
“We also believe that record-keeping should be implemented hand-in-hand with mandatory public disclosures, especially from the tobacco industry, covering the volume of tobacco products produced, imported and kept in storage. Such measures will enable more accurate estimates of illicit trade activity and inform policy on illicit tobacco trade,” it added.
Without the creation of the track-and-trace system, the group claimed that the proposed amendments to the Anti-Agricultural Smuggling Act of 2016 through SB 2432 would “simply be ink on paper.”
“We call on our legislators to pass a bill [that] will sufficiently address illicit tobacco trade, thereby protecting public health and preventing tax collection erosion,” the STC said.