Nationwide raids on cigarette smugglers, sellers good, but should be sustained

The consumption of cigarettes and other tobacco products has traditionally been established as a leading cause of death through lung cancer and other pulmonary diseases. Despite this, many are addicted to this tar-and-nicotine fix so that for obvious health reasons, the government has increased taxes on cigarettes to dissuade people from buying these products.

High taxes, however, increase the likelihood of smuggling since there is much to gain from importing highly taxable goods, and syndicates are incentivized by the prospect of the illegal windfall.
Both the Bureau of Customs and the Bureau of Internal Revenue have launched campaigns against smugglers of cigarettes and tobacco in the past but since these were not sustained, the evil malady keeps coming back.

With a new commissioner now at the helm of the BIR, this top government revenue collector has experimented on a novel tack: Simultaneous raids on businesses allegedly selling untaxed cigarettes around the country, which it implemented last Tuesday, Jan. 24. This is the first time that such a nationwide drive was done.

The BIR swooped down on 21 provinces, 69 cities and municipalities nationwide, specifically some 378 wholesalers and retailers that were selling illicit cigarettes and confiscated millions of pesos worth of illegal cigarettes that are untaxed, fake and smuggled. The revenue agency was assisted by the Philippine National Police and local officials.

BIR Commissioner Romeo Lumagui Jr. and OIC-Deputy Commissioner for Operations Maridur Rosario spearheaded the operations in Metro Manila with surprise inspections of wholesale and retail outlets in Tondo, Manila.

According to the BIR, the government is losing ₱50 to ₱100 billion in tax revenues from the illicit tobacco trade, which is intended to fund basic services, including the Universal Health Care program and other national development goals.

Various revenue regions in Luzon held a total of 195 simultaneous operations in Pangasinan, Nueva Ecija, Tarlac, Zambales, Pampanga, Bulacan, Palawan, Rizal, Cavite and in Manila. Authorities have launched 115 in Mindanao and 68 in Visayas.

The BIR personnel noted that the provinces of Zambales, Pangasinan, Negros Oriental, Eastern Samar, Agusan del Sur, North Cotabato and Davao del Sur, and the city of Zamboanga were the leading "hotspot areas" in terms of cigarette smuggling and sale of the illegal products. In Zamboanga City alone, more than 100 stores located in public markets were found selling various brands of illegal cigarettes at a wholesale price as low as ₱30 per pack.

BIR is now preparing the filing of appropriate charges against owners of the stores in violation of various laws in relation to National Internal Revenue Code of 1997 and the agency’s minimum price requirement, among others.

Store and warehouse inspections, along with seizures of contraband, are only the first steps toward fighting smugglers and tax cheats. Hard work is still ahead for our law enforcement agents, in the prosecutor's offices and the courts, to put the criminals in jail. We encourage them to see through their work up to the very end.