Connect with us

Hi, what are you looking for?

News

Illicit cigarettes take up 10% of market

The Bureau of Customs Port of Cagayan de Oro destroyed illicit cigarettes worth P30 million on Sept. 8. — COURTESY OF BUREAU OF CUSTOMS

THE DEPARTMENT of Finance (DoF) estimates that illicit cigarettes may account for up to 10% of the market amid an increase in smuggling and illegal manufacturing as excise taxes rose.

“As the tax on cigarettes increases, there is more incentive to smuggle. So we’ve seen increases not only in illicit cigarettes coming in but small factories being set up,” Finance Secretary Carlos G. Dominguez III said at a virtual press briefing.

“The manufacturer of cigarette-making machines has been able to miniaturize this. As I’ve mentioned before, you can be in business if you have a hundred square meters of warehouse.”

He said most illicit cigarette sellers are caught by the Bureau of Customs and Bureau of Internal Revenue, reducing the number of illicit cigarettes sold in the country.

“The last figure I saw was between 7% and 10% (of the cigarette market) are illicit. Prior to our cracking down on this illicit cigarette business, I understand it was around 35%,” he said, quoting industry figures.

Excise taxes on cigarettes and other tobacco products have been raised three times since 2016 as the government seeks funds for the Universal Health Care (UHC) program.

Excise tax collections on cigarettes rose 31% to P83 billion in the first seven months of 2021 as tax rates increase and sales figures rebound.

President Rodrigo R. Duterte in 2019 signed Republic Act No. 11346, which gradually raises cigarette excise tax to P60 per pack by 2023, and then by 5% every year thereafter.

The DoF is also keeping an eye on the shipment of smuggled cigarettes in the Port of Subic.

The relevant government bureaus have been conducting raids in Subic that have resulted in seized cigarette-making machines and products, Finance Assistant Secretary Dakila E. Napao said. — Jenina P. Ibanez

Your information is secure and your privacy is protected. By opting in you agree to receive emails from us. Remember that you can opt-out any time, we hate spam too!

Latest

News

Follow us on Spotify BusinessWorld B-Side The Filipino workforce is gradually adapting to a work environment that has been changed forever due to the pandemic....

News

The Department of Environment and Natural Resources (DENR) has given recognition to volunteers and partners who had significant contribution to the cleanup and rehabilitation...

News

Spotlight is BusinessWorld’s sponsored section that allows advertisers to amplify their brand and connect with BusinessWorld’s audience by enabling them to publish their stories...

News

Former client, Jennifer Pacquing on her experience with Planning for Canada services. Planning for Canada – Planifier pour le Canada (PfC) is pleased to...

News

Windmills are seen in Pililia, Teresa, Rizal province on April 25. — PHILIPPINE STAR/ MICHAEL VARCAS THE INCOMING Marcos administration should consider the full...

News

THE PHILIPPINE central bank should deliver more aggressive rate hikes in order to curb inflation that is now expected to reach 5% this year,...

You May Also Like

News

BW FILE PHOTO GROSS BORROWINGS by the National Government reached P2.6 trillion as of end-September as it continued to raise funds to respond to...

News

REUTERS By Luz Wendy T. Noble, Reporter The country’s foreign exchange buffers slightly increased as of end-October as the value of the central bank’s...

News

COVID-19 has had a significant impact on the mental health of Filipinos across different groups all over the archipelago. From frontline workers, parents balancing...

Financial Advisors

The healthcare ecosystem is one that has thrived on the cusp of scientific progress, benefitting enormously from the winds of change in the technological...

Disclaimer: Respect Investment.com, its managers, its employees, and assigns (collectively "The Company") do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

Copyright © 2022 Respect Investment. All Rights Reserved.