SEVEN months since tax stamps were required on all cigarette products, many stores in Mindanao were found selling cigarette packs still not bearing the proof of tax payment labels in a market survey conducted last week by the Fight Illicit Trade (Fight IT) movement.
The government through the Bureau of Internal Revenue (BIR) implemented the Internal Revenue Stamps Integrated System (IRSIS) that requires all cigarette manufacturers to affix tax stamps on each pack of cigarettes beginning Dec. 1 last year. BIR further required that
effective March 1, 2015, no manufacturer can sell any more pack without tax stamps. The same applies to imported cigarettes effective April 1 this year.
The BIR implemented IRSIS to address the concerns on illicit cigarette trade in the country, and the use of tax stamps ensures that each pack is legitimate and has paid the excise tax.
The Fight IT movement ran simultaneous market surveys in different barangays in the cities of Cagayan De Oro, Davao, General Santos and Zamboanga to check on compliance by manufacturers, wholesale and retail stores.
The market survey, according to Fight IT lead convenor Jesus Arranza, showed that several local brands as well as imported cigarettes believed to be smuggled to the country were openly sold without the tax stamps.
39 wholesale and retail stores in Cagayan De Oro City; 20 retailers in Davao City; nine retailers in General Santos City; and 40 retail and wholesale outlets in Zamboanga City were openly selling significant quantities of products without tax stamps. The situation in outlying areas could even be more alarming.
The Fight IT movement warned consumers against patronizing the “no tax stamps” cigarette packs as this is not only illegal without the requisite tax payment, but its origin and production are not known as well.
In line with the group’s advocacy to fight all forms of illicit trade activities, Fight IT called on the public to be vigilant in spotting illegal products and report these to authorities.
“Tobacco products are specifically taxed per pack at increasing rates of excise, precisely because tobacco is harmful and addictive, and the tax is intended to make the product less affordable, thereby encouraging people to quit.
“The national and local authorities in Mindanao should be alarmed at this flagrant circumvention of the law that is not only denying revenues, but undermining important public health objectives.
“Let us work together to combat this menace. We cannot allow manufacturers and store owners to be scot-free in selling illegal products without paying tax. Do we let them go when we tax-paying citizens are duty-bound to help the government?” Arranza asked.
The Fight IT is a broad-based, multi-sectoral movement intended to protect consumers, safeguard government revenues and shield legitimate industries from the ill-effects of smuggling. It was launched earlier this month under the umbrella of the Federation of Philippine Industries (FPI). Arranza is the chairman of FPI.
Fight IT carries the campaign slogan “Stop smuggling, Protect the consumers.”
The alliance brings together major players from industries with some of the most commonly smuggled goods or products such as rice, sugar, corn, palm oil, tobacco, steel, cement, ceramic tiles among others.
The group will provide to enforcement authorities for their appropriate action the list of outlets found to be selling without tax stamps.
The BIR has warned against the serious consequences of non-use and use of counterfeit stamps. Penalty ranges from a fine of up to P50,000 and imprisonment of not less than four years but not more than eight years.