In a statement issued during the weekend, the Philippines’ Finance Secretary ordered the Bureau of Internal Revenue (BIR) and the Bureau of Customs to work closely with their counterparts in Beijing to stop the illegal entry of cigarette-manufacturing machinery, according to a story by Elijah Joseph C. Tubayan for Business World.
‘What we have to stop is the import of the equipment, which is coming from China,’ Secretary Carlos G. Dominguez III was quoted as saying.
This was the second such intervention in a fortnight. At the end of November, the Philippines Customs Commissioner Rey Leonardo Guerrero said that the Customs Bureau would ask its counterpart in China to stop exports of cigarette-manufacturing machinery to the Philippines in a bid to crack down on the manufacture there of fake cigarettes.
According to the latest story, the Department of Finance said that raids conducted by the BIR earlier this year had indicated that, after the government had cracked down on the illegal entry of fake cigarettes and fake tax stamps, smugglers had shifted to illegally importing cigarette machines capable of making fake versions of popular brands.
Starting in June, the BIR was said to have confiscated cigarette-making machines, packing machines, filter-making machines, and fake tax stamps found in warehouses in Pampanga and Cagayan de Oro, as well as several other warehouses elsewhere in Luzon and in Mindanao.
The proliferation of counterfeit cigarettes is a revenue problem for the government and legitimate tobacco manufacturers. Philip Morris Fortune Tobacco Corp. Inc. (PMFTC) and JTI Philippines have pressed the BIR to clamp down on fake cigarettes and, last week, the National Bureau of Investigation, acting on a tip from PMFTC, raided an unlicensed cigarette factory in Pangasinan that is said to have been the country’s main source of fake cigarettes.
The BIR commissioner Caesar R. Dulay is on record as saying that fake cigarettes became more prevalent, especially outside Metro Manila, after the government imposed higher excise taxes on tobacco products in January.
Another bill, raising tobacco taxes further is advancing in Congress after the House of Representatives approved it on its final reading last week.
Smuggling machinery
