The House Committee on Ways and Means approved on Tuesday the unnumbered substitute bill to House Bill 10329, seeking to strengthen the administration of tax on tobacco products, cigars, cigarettes, heated tobacco products, vapor products and novel tobacco products.
Albay Rep. Joey Sarte Salceda, principal author of HB 10329, said the illicit tobacco trade has serious implications as smokers turn to cheaper alternatives, leading to lower taxes.
“Illicit tobacco trade makes cheap cigarettes accessible to consumers, especially the poor and the youth, and leads to losses in tobacco tax revenues, which, through the Sin Tax Reform Law, are earmarked for the implementation of the Universal Health Care (UHC) Law. UHC ensures access to cost-effective and quality healthcare for every Filipino,” Salceda said.
Through good enforcement, good governance and good institutions, Salceda believes that Illicit tobacco trade can be neutralized.
As of May 2023, he said the Bureau of Customs (BOC) has destroyed 19,419 cases and 667 reams of smuggled cigarettes worth P1.44 billion.
“This shows that anti-smuggling campaigns can be successful in recouping revenues. But much more has to be done,” he said.
He said the substitute bill seeks to impose heavy penalties on perpetrators of illicit tobacco trade. It also proposes the creation of an Inter-Agency Tobacco Illicit Trade Council that would be chaired by Department of Finance (DOF) to implement appropriate measures to suppress illicit trade of covered products.
Marikina City Rep. Stella Luz Quimbo, chair of the technical working group that crafted the substitute bill, said the measure highlights several changes in HB 10329.
These include the mandatory use of a tracking system which requires the use of secure digital markers through unique identifier features on tobacco products , as well as the mandatory registration of manufacturing equipment for tobacco products within 30 days from acquisition or disposal.
The substitute measure also enumerates the responsibilities of digital platforms in ensuring the absence of illicit covered products in their respective platforms.
The measure, which also outlines the procedure for custody and disposal of seized products, is still subject to style and amendments.
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