Tobacco firm warns of more cigarette smuggling

CEBU, Philippines —  A global tobacco company has alerted the law enforcement agencies to intensify their anti-smuggling efforts in the country, particularly in Visayas and Mindanao.

Japan Tobacco International has warned that more cigarette contrabands are expected to enter the country’s backdoor during the yuletide season.

JTI general manager John Freda said that key areas in Mindanao and Visayas have been traditionally the backdoor channels for illegal cigarettes as indicated in the series of seizures at different ports over the past weeks.

In Cebu, the Bureau of Customs hauled a total of P148 million in illegal cigarettes in August alone followed by the seizure of two containers filled with cigarette contraband worth P88.1 million in September.

The BOC-Cebu has destroyed a total of P180 million worth of smuggled goods last month of which 36 percent were illegal cigarettes.

Other ports in the Visayas also reported incidents of cigarette smuggling recently.

In Mindanao, BOC also intercepted some P96.6 million worth of illegally imported cigarettes in the Port of Davao while destroying P50 million worth of illegal cigarettes in Cagayan de Oro, both happening in the first week of October.

Freda lauded the series of successful operations made by the BOC and the Bureau of Internal Revenue in recent months as smuggling incidents became rampant amid the pandemic.

“I understand that for a country with so many islands like the Philippines, it is a huge challenge to control the problem, but the deterrents need to be stronger,” Freda said.

He also reiterated his call for higher penalties and sanctions against tobacco smugglers to sharpen the deterrence.

Freda warned that more smuggling attempts are expected with increasing frequency during the yuletide months even with a quarantine in effect.

“Syndicates will surely try to cash in on this and compete with legal and tax-paying tobacco players as the pandemic drags on until Christmas and even beyond New Year,” Freda pointed out.

He stressed that coastal borders and port cities in the Visayas and Mindanao must be put under tighter watch to thwart smugglers taking advantage of the current situation.

JTI global study showed that organized criminal groups around the world are capitalizing on the COVID-19 pandemic to operate their illicit tobacco trade.

According to Freda, illegal tobacco trade is considered a lucrative business for criminals who make huge profits with very low risk of getting caught and “insignificant” penalties.

This also deprives the government of collecting revenues, with both contraband and counterfeit cigarettes being smuggled without paying taxes.

According to the World Bank, the global trade in illegal tobacco is already worth an estimated $40 billion to $50 billion each year.

The government has also been confronted with a diminished collection from tobacco excise tax since the pandemic hit in early March this year.  (FREEMAN)