Government seizes P2 billion worth of smuggled cigarettes in H1

MANILA, Philippines — Smuggled cigarettes in the country – at nearly P2 billion as of end-July – have already surpassed the 2022 level, proving that the illegal entry of the commodity remains rampant.

During the International Tobacco Agricultural Summit yesterday, the Bureau of Customs said it conducted 152 seizure operations that resulted in the apprehension of cigarette and tobacco products worth P1.89 billion.

Data showed this is already 67 percent higher than the aggregate P1.13 billion in seizures for the commodity for the entire 2022.

Customs Intelligence and Investigation Service director Verne Enciso said a significant component of the almost P2 billion seized items was the raid in Sulu last May that yielded P1.44 billion in smuggled cigarettes.

These covered a total of 19,000 cases, equivalent to about 190 million sticks.

“For this year, the number of seizures has already been exceeded, and at the same time the amount of that also as compared to last year,” Enciso told reporters.

“We are confident that we will have more seizures since we have continuing efforts on anti-smuggling and border control,” he said.

Enciso noted that the continued easing of border restrictions across countries has contributed to more smuggling.

Customs Commissioner Bienvenido Rubio, on the other hand, said several countries are considered as sources of smuggled cigarettes, including Cambodia, Vietnam, Taiwan and Myanmar.

Some items also come from transshipment ports in Hong Kong and Singapore.

The Bureau of Internal Revenue (BIR), for its part, said illicit trade of tobacco and cigarettes remains a challenge as this results in loss of tax revenues for the government.

BIR Commissioner Romeo Lumagui said smuggled cigarettes are flooding the market with substandard products that could be detrimental to public health. It also gives rise to unfair competition that could be harmful to the local workforce.

“We want to level the playing field because the collections should be used for the healthcare system and could impact on economic growth,” Lumagui said.

Anti-smuggling group Fight Illicit Trade (Fight IT) earlier estimated that the government is losing some P24.7 billion in revenues per year due to cigarette smuggling.

Roughly 14 percent of cigarettes or about nine billion sticks consumed in the country are illicit.

Smuggled cigarettes are sold at P2 per stick, easily undercutting legitimate cigarettes by not paying excise taxes. The lowest priced tax-paid cigarette is sold at P6 per stick.