LEGISLATORS said certain groups are spreading misinformation to undermine a bill that seeks to combat illicit trade and bolster revenue collections.
Deputy Speaker and Ilocos Sur 2nd District Representative Kristine Singson-Meehan, one of the bill’s sponsors, said while they are looking forward to the coming discussions on House Bill 11279 in the House Ways and Means Committee, “it is concerning that certain groups are spreading misleading information to undermine the intent of the bill, which is to stop the spread of illicit trade and boost revenue collections.”
“With these false narratives circulating, they are distracting from the critical conversations at hand. The committee is about to carefully review and study the various position papers to find a fair, objective, and balanced solution that can address pressing concerns related to health, illicit trade, tax collection, and the wellbeing of tobacco farmers,” she said.
Singson lamented that misleading claims which delay the progress of the bill will only benefit illicit traders who continue to exploit loopholes in the system.
“This bill is a revenue measure. We need that revenue for essential healthcare and services for our people. We cannot allow misleading claims and malicious tactics to derail the process and block progress that would benefit our economy and the welfare of our people,” she added.
HB 11279 co-author Ilocos Norte 2nd District Rep. Angelo Marcos Barba noted that illicit traders are becoming increasingly desperate as the government tightens its grip on the illegal market.
“With the filing of HB 11279, they see the writing on the wall. This measure would bring them to their knees because it would cut off their avenues for smuggling. The government is closing in, and their grip on the market is slipping,” Barba said.
He noted that the passage of Republic Act (RA) 12022, or the Anti-Agricultural Economic Sabotage Act was a significant milestone in the fight against illicit trade.
“Since the passage of RA 12022, or the Anti-Agricultural Economic Sabotage Act, these unscrupulous individuals have been scrambling. These laws are not just words on paper; they are powerful weapons to protect our economy, our farmers, and our people from exploitation and greed,” he said.
Other sponsors of the bill include Deputy Speaker and Isabela 1st District Rep. Antonio Albano, Kabayan Party-list Rep. Ron Salo, Ifugao Lone District Rep. Solomon Chungalao, and PBA Party-list Rep. Margarita Nograles-Almario.
In the bill’s exploratory note, the authors said that while higher taxes on tobacco products are intended to reduce smoking rates, they have also inadvertently fueled the rise of illicit and counterfeit products.
“While it is in the country’s legitimate interest to impose higher taxes on sin products, the increase in the amount of excise taxes imposed on registered cigarette products unintentionally resulted in the proliferation of illicit and counterfeit products due to their low entry point and affordability,” the authors said.
Citing industry data, the bill highlights a surge in illicit trade, with its share rising from 5.3% in 2020 to 13.2%in 2023. The number of consumers purchasing illicit cigarettes has also grown, reaching an average of 13.9% last year.
The bill reveals that counterfeit and smuggled products are more appealing to consumers due to an alarming rise in illicit trade that is primarily driven by high excise taxes on tobacco products.
“Due to the prevalence of illicit tobacco products, the government’s excise tax collection has been declining since 2022. From a peak collection of P176 billion in 2021, tobacco excise revenues declined to P160 billion in 2022. In 2023, the Bureau of Internal Revenue (BIR) reported that the government has lost around 15.9 percent or P25.5 billion in revenue due to illicit trade in cigarettes, ending collections in 2023 with P135 billion,” House Bill 11279 stated.
