The Bureau of Internal Revenue (BIR) seized more than ₱516 million worth of illicit cigarettes in Valenzuela City amid the government’s crackdown on the underground tobacco trade and its associated tax leakages.

In an operation conducted in coordination with the Department of the Interior and Local Government, BIR operatives confiscated 1,274 master cases of cigarettes that lacked the mandatory internal revenue stamps required under the National Internal Revenue Code.

The total estimated excise tax deficiency, which includes applicable penalties and surcharges, stands at ₱516,795,424.60, according to a statement from the agency.

The enforcement action was initiated following intelligence relayed by the DILG to the tax bureau.

BIR Commissioner Charlito Martin R. Mendoza directed the immediate issuance of mission orders for field verification after receiving the tip, dispatching personnel from Revenue Region No. 5 to the identified site.

The discovery of the unstamped goods suggests a sophisticated attempt to bypass the country’s excise tax framework, which serves as a critical revenue stream for the national budget and universal healthcare funding.

This latest seizure highlights the persistent challenge of illicit trade in the Philippines, where high excise taxes on tobacco products have inadvertently fueled a market for cheaper, untaxed alternatives.

The BIR has intensified its surveillance and enforcement activities in industrial hubs such as Valenzuela City, which often serve as transit or storage points for contraband.

Mendoza has reiterated that the bureau will continue to pursue aggressive tax enforcement to ensure a level playing field for legitimate businesses that comply with the country’s fiscal regulations.

Under the current Tax Code, the absence of valid revenue stamps is considered prima facie evidence of non-payment of excise taxes, allowing for the immediate seizure of the goods. The BIR is now expected to file criminal charges against the individuals or entities responsible for the warehouse and the illegal inventory.

This crackdown aligns with broader efforts by the administration to plug revenue holes and improve tax administration efficiency without necessarily imposing new taxes on the public.