Tobacco firms want stronger penalties vs cigarette smuggling

MANILA, Philippines — The move to slap more penalties and make cigarette smuggling a non-bailable offense is seen plugging massive losses from the illegal entry of the commodity, a tobacco firm said.

The local unit of Japan Tobacco International (JTI) is backing the latest measure filed in Congress to declare cigarette smuggling as an act of economic sabotage.

House Bill 3917 would mean heftier penalties including making the illicit trade non-bailable. If passed into law, cigarettes will join other commodities such as rice, sugar, corn, pork, poultry, garlic, onion, carrots, and fish in the economic sabotage list.

This would effectively make the illegal importation of tobacco, either in raw or finished form, a heinous crime.

JTI Philippines general manager John Freda said the bill’s passage would put more teeth into the government’s effort to curb illegal tobacco trade and plug revenue losses.

“We view this as a necessary step to make this crime an act of economic sabotage because simply it robs the nation’s coffers, which is still reeling from a long-drawn out pandemic,” Freda said.

It is estimated that the government is losing some P30 billion to P60 billion annually from cigarette smuggling.

For one, 60 percent of cigarettes sold in Zamboanga del Sur and Misamis Occidental are illegal.

“Not only does it deprive the government of much needed tax revenue at this time, but illegal trade cheats everyone,” Freda said.

He said that cigarette smuggling impacts various sectors including farmers, retailers, consumers, tobacco-growing local government units, legitimate businesses, and revenue collection agencies.

Worse, Freda emphasized that illegal tobacco sales often finance larger criminal activities such as corruption, smuggling of drugs and weapons, human trafficking and terrorism.

“Cigarette smuggling has become more rampant even at the height of the pandemic and despite intensified action on the part of law enforcement,” Freda said.

Under the proposed law, cigarette smugglers will face a minimum of 30 years imprisonment but not exceeding 40 years with no bail recommended.

Violators will also be obliged to settle a fine double the value of the seized smuggled items, plus the total amount of unpaid duties, and other taxes.

JTI Philippines is the distributor of international brands Winston, Camel and Mevius, and local brands Mighty and Marvels.