JTI: Anti-agri economic sabotage law to cut tax losses

A tobacco company said that ratifying the anti-agricultural economic sabotage bill will minimize the losses from the government’s revenues and farmers.

Japan Tobacco International (JTI) said that the increasing illicit cigarette trade in the Philippines poses a significant threat to the nation’s economy including its agricultural sector.

JTI General Manager John Freda said the quick enactment of the bill would send a strong message to smugglers and their accomplices about the government’s serious commitment to address the worsening problem of illicit.

“Once the law is ready for full implementation by the mandated agencies, the government has an additional potent weapon in its arsenal to wage war against smuggling syndicates,” Freda said.

“We are looking forward to its full implementation. The crime of tobacco smuggling is indeed an act of economic sabotage because, put simply, it robs the nation’s coffers. Not only does it deprive government of much needed tax revenues but illegal trade cheats everyone: society, consumers and legitimate businesses,” he added.

Under the proposed law, tobacco smuggling as economic sabotage carries heftier penalties of life imprisonment and a fine of thrice the value of the agricultural and fishery products subject to the crime.

The bill also repeals the Anti-Agricultural Smuggling Act of 2016 with tobacco – either in its raw or finished form – joining rice, sugar, corn, pork, poultry, garlic, onion, carrots, fish, and "cruciferous vegetables” on the ‘economic sabotage’ list.

Estimates from Congress and the Bureau of Internal Revenue (BIR) put the foregone losses from illicit tobacco trade between P60 billion and P100 billion a year.

Meanwhile, the BIR earlier said that the government has so far lost P6.6 billion in excise taxes as of this year due to the illegal trade of tobacco.

READ: BIR: Illicit trade, vaping drain P6 billion in excise taxes

The JTI official also said, proceeds from illegal tobacco sales often finance larger criminal activities such as corruption, the smuggling of drugs and weapons, human trafficking, and terrorism.

Freda also congratulated Sen. Cynthia Villar and Rep. Wilfrido Mark Enverga, chairpersons of the Senate and House committees on agriculture, respectively, for successfully shepherding the proposed measure in the committee level to the bicameral conference panel.

The Senate version was principally authored by Villar while the House bill was jointly filed by Reps. Ferdinand Alexander “Sandro” Marcos and Margarita Ignacia B. Nograles.

JTI Philippines had previously called for stiffer sanctions against cigarette smuggling even at the height of the COVID-19 pandemic, despite intensified law enforcement actions.