SEN. Sherwin Gatchalian is seeking an investigation on the foregone tax revenues on products imposed with excise taxes due to smuggling and illegal trading.
In filing Senate Resolution No. 1243, Gatchalian said the investigation aims to determine who is behind the smuggling and illegal trade of these products and come up with measures to strengthen the government’s campaign against the illegal acts.
He said the Department of Finance said the government is losing around P52 billion a year from the smuggling of vape and tobacco products – P35 billion from smuggled tobacco products and P17 billion from smuggled vape products.
Gatchalian said a report from the Bureau of Customs showed it had confiscated some P6.5 billion worth of smuggled vape products from October 2023 to August 2024.
He said other law enforcement agencies like the PNP have confiscated some P2.4 billion worth of fake cigarettes and smuggled equipment, while the Bureau of Internal Revenue seized 5,385 illicit vape products during the Philippine Vape Festival Compliance last August.
He said the event was supposed to be a gathering to discuss current regulations and policy changes in the industry.
Aside from tobacco and vape products, Gatchalian said there was also a report which said that around $18 million worth of smuggled wine were intercepted by Hong Kong Customs which were bound to the Philippines last September.
Last July, he said the BIR confiscated 390,000 liters of ethyl alcohol for non-payment of excise taxes amounting to more than P700 million.
Gatchalian said it is high time to stop the smuggling and illicit trade of these products which lead to huge revenue losses for the government.
“Despite the effort of the various government agencies, the illicit trade and smuggling of exciseable products remain rampant across the nation…It is important to note that smuggling and illicit trade is not a victimless crime. Aside from reducing government revenues, smuggling and illicit trade also undermines the rules of law, fuel corruption, impair the competitiveness of legitimate businesses while becoming a major source of income of organized groups, and taints the reputation of our country in the global scene,” Gatchalian said in the resolution filed last November 28.
