Tag: Philipinnes

  • Philippines Urged To Support Farmers at COP

    Philippines Urged To Support Farmers at COP

    Photo: Phiilip Morris Fortune Tobacco Co.

    Filipino tobacco growers are asking their government to advocate for their livelihoods at the 10th Conference of the Parties (COP10) to the World Health Organization’s Framework Convention on Tobacco Control (FCTC), which is scheduled to take place Feb. 5-10 in Panama.  

    “Our lives are deeply intertwined with tobacco farming,” Leonardo Montemayor, a former agriculture secretary and board chairman of the Federation of Free Farmers, told The Manila Standard. “It is a way of life and our means of survival amid harsh economic headwinds. With the Department of Agriculture roadmap affirming its long-term support for tobacco farming, we hope that the Philippine government will take that commitment to heart when championing our industry in this upcoming COP. 

    The National Tobacco Administration (NTA) recently launched the Sustainable Tobacco Enhancement Program (STEP), an initiative aimed at boosting indigenous tobacco cultivation, particularly in Mindanao.

     Saturnino Distor, president of the Philippine Tobacco Growers Association, said STEP would improve tobacco farmers prospects, especially with the regulation of safer alternatives to cigarettes like vapes and e-cigarettes. “Studies and science show these are better than cigarettes. That’s where the industry is headed, so we have hope that tobacco farming will continue,” he said.  

    “Tobacco farming sustains millions of farmers and their families, as well as workers in the industry,” Distor said. “Switching crops requires significant investment in new infrastructure. If the future of alternative products is uncertain, what about the future of farmers? We appeal for compassionate and humane policies.” 

    The Philippine tobacco sector employs more than 2.1 million people and contributes significantly to government income, with PHP160 billion ($2.86 billion) collected in excise taxes in 2022, according to the NTA.

  • Cash to ‘Marginalized’ Philippine Growers

    Cash to ‘Marginalized’ Philippine Growers

    Photo: Philip Morris Fortune Tobacco Co.

    The Philippines’ National Tobacco Board (NTA) has allocated about PHP17 million ($306,077) to assist marginalized tobacco growers in Ilocos Norte, reports the Philippine New Agency.

    At least 160 beneficiaries from the towns of Pinili, Batac and Badoc received their respective PHP6,000 grant on Thursday. The next distribution will continue until all the target recipients have received their cash assistance.

    The grant targets growers who are tilling lots of 0.5 hectare and below to reduce their production cost. The assistance will cover the cost of fertilizers, crop protection agents, seedlings, suckercides, land preparation, gas and oil, fuelwood and labor.

    Tobacco-growing provinces and municipalities in the Philippines collect their share from tobacco excise tax collections based on the volume of leaves produced by their local tobacco growers.

    The NTA also provides assistance for rice production, improved tobacco seedlings production and beef cattle production.

  • Leaf Traders Agree to Higher Floor Prices

    Leaf Traders Agree to Higher Floor Prices

    Photo: PMFTC

    Farmers and buyers have agreed on new floor prices for Philippine tobacco for the next two trading years, reports The Inquirer.

    The floor price for Virginia tobacco grades will increase by PHP9.90 ($0.17) per kg, while that for burley and native tobacco will go up by PHP5.90 and PHP3.90 per kilo, respectively, according to the National Tobacco Administration (NTA).

    “We aim to improve our industry by helping one another to balance the economic significance of tobacco as one of the highest contributors to the government coffer,” said Agriculture Undersecretary Deogracias Savellano.

    Tobacco farmers have been pushing for higher floor prices since earlier this year, citing an increase in imports and labor.

    The NTA convenes the tripartite conference every two years to review and fix tobacco floor prices based on factors such as the world market, production costs and profit margins for farmers, dealers, manufacturers and exporters.

    In 2022-2023, the floor prices of Virginia top grades were between PHP86.10 and PHP87.10 per kg. High grades of burley attracted PHP72.10 to PHP75.10 per kg, while the floor price for the native top grade was at PHP77.10 per kilo.

    NTA data show that the tobacco industry contributed PHP149.7 billion in revenues to the government in 2020.

    The sector provides livelihoods to at least 2.1 million people, including at least 430,000 farmers and farmworkers, the NTA said.

  • Philip Morris granted partial VAT refund

    Philip Morris granted partial VAT refund

    Photo: mehaniq41

    The Philippines Court of Tax Appeals (CTA) granted part of a refund claim by Philip Morris Philippines Manufacturing in the amount of PHP32.04 million ($564,407), which represents its unused input value-added tax (VAT) traced to zero-rated sales in 2015, reports Business World Online.

    The court ruling stated that Philip Morris was able to prove its entitlement to the amount by proving that sales invoices were actual shipments from the Philippines to foreign countries for export sales.

    “The court finds that even without the reopening of the trial at the division level, the submissions made by Philip Morris clarifying certain tabular presentations/summaries of its alleged zero-rated sales may already be reconsidered,” Associate Justice Catherine T. Mahan said in the ruling.

    Zero-rated sales are transactions made by VAT-registered taxpayers that do not translate to any output tax. Taxpayers must present official receipts that are attributable to a specific fiscal period, with the term “zero-rated” being written on them to qualify for a 0 percent rating.

    Philip Morris previously sought a refund of PHP90 million covering excess input VAT for 2015, which was partially granted by the CTA Third Division—the commissioner of internal revenue (CIR) was ordered to issue a refund of PHP31.18 million to Philip Morris.

    The CTA said the CIR failed to present new arguments that would call for a dismissal of the case while the CIR argued that the CTA should have rejected Philip Morris’ appeal since the export sales were not proven to be paid in acceptable foreign currency in line with the applicable rules. The CTA disagreed, stating Philip Morris has submitted acceptable bills showing that the shipments were paid for in acceptable foreign currency.

  • Philippine Law Paves Way for Alternatives

    Philippine Law Paves Way for Alternatives

    Photo: Balint Radu

    The enactment of a new vape law in the Philippines last year has paved the way for products that provide smokers with better alternatives to cigarettes, according to Philip Morris Fortune Tobacco Co. (PMFTC) President Denis Gorkun.

    In addition to moving regulation of vapes from the Philippine Food and Drug Administration to the Department of Trade and Industry, Republic Act 11900 lowered the purchase age for e-cigarettes and heated tobacco products from 21 to 18, removed a two-flavor limit on product flavors and allows companies to conduct corporate social responsibility-related activities.

    In an interview with the Manila Bulletin, Gorkin said PMFCT would soon launch IQOS Luma, which uses induction technology to heat tobacco, and ZYN nicotine pouches in the Philippines. Made by Swedish Match, which was acquired by PMFTC’s parent company, Philip Morris International in 2022, ZYN is the best-selling nicotine pouch in the United States today.

    Since PMFTC launched IQOS in the Philippines, around 75,000 local smokers had switched away from cigarettes, according to Gorkun.

    Gorkun said PMI aims to eliminate cigarette consumption in line with its vision to deliver a smoke-free future. “We will continue to work towards our smoke-free future vision with products that are found by numerous international health authorities to be far better compared to continuing to smoke cigarettes.”

    He said the passage of the landmark Vape Law a year ago is a “win” for public health. While providing smokers with less harmful options, the law also contains provisions to deter underage consumption, according to its proponents.

    One of the authors of the vape law, former Representative Sharon Garin, said Republic Act 11900 provides that vaping isn’t made appealing to minors. “We don’t want non-smokers to pick up the habit of vaporized or electronic cigarettes,” she was quoted as saying. “What we want is a less harmful alternative for current smokers.”

  • Manila Rolls Out Red Carpet for HTP Makers

    Manila Rolls Out Red Carpet for HTP Makers

    Photo: PMI

    The Philippines’ Department of Trade and Industry (DTI) is urging tobacco companies to manufacture their heated tobacco products in the country, citing surging domestic demand and export opportunities, according to the Philippine News Agency.

    During the International Tobacco Agriculture Summit in Taguig City on Aug. 2, DTI Undersecretary Ceferino Rodolfo said while local demand for cigarettes is expected to decline from 49.61 billion sticks in 2022 to 39.06 billion sticks in 2027, sales of HTPs are poised to increase significantly during that period.

    He cited a Euromonitor predicting HTP retail sales of HTPs to surge by 511 percent to 4.06 billion sticks in 2027.

    Rodolfo said HTP producers would benefit the Philippines’ free trade agreements with regional markets. “HTPs, if manufactured in the Philippines, can be imported in ASEAN (except Vietnam), Australia, New Zealand, Japan, Korea, and Hong Kong at zero percent tariff duty,” he was quoted as saying.

    In 2022, the top destinations for Philippine tobacco products included South Korea at $102.2 million, Thailand ($98.29 million) and Myanmar at $49.4 million.

    According to Rodolfo, Philip Morris Fortune Tobacco aims to build a PHP9-billion factory in Tanauan, Batangas, for the production of IQOS devices.

  • Philippines: Partnership Against Illicit Trade

    Philippines: Partnership Against Illicit Trade

    Photo: sebra

    The Philippines Bureau of Customs (BOC) has partnered with tobacco companies to help combat illicit trade in the country, reports the Philippine News Agency

    “These groups [smugglers and illicit traders] have been very creative and aggressive in entering our markets,” said Bienvenido Rubio, BOC commissioner. “Accordingly, close cooperation with tobacco companies is aimed at addressing their various modus (operandi) with even more comprehensive methods.”

    The BOC met with Philip Morris International and Philip Morris Fortune Tobacco Corp. executives. Rubio said they will work together to ensure public health safety and fair tobacco trade.

    “That has always been our goal and our mandate—to put these smugglers away and make them accountable, answerable and ultimately face the consequences of their nefarious activities,” he said.

    “It is important for us to recognize that these (schemes) are not only very real threats but well-orchestrated plans aimed at circumventing our laws,” said Verne Enciso, customs intelligence and investigation service director.

  • Illegal Cigarette Factories Dismantled

    Illegal Cigarette Factories Dismantled

    Photo: Mykhailo Polenok

    Tax authorities dismantled two illicit cigarette operations in the Subic Bay Freeport on July 14, reports the Philippine News Agency.

    OneSubic Premier Manufacturing Corp. (OPMC) and Hongcim International Corp. were found to be illegally manufacturing various cigarette brands. While OPMC is licensed to manufacture cigarettes, its brands and equipment were not registered with the appropriate agencies, according to the Bureau of Internal Revenue’s Tax Compliance Verification Drive (TCVD) team.

    OPMC and Hongcim produce and package foreign-branded cigarettes, including RGD, Baisha and Bruston.

    During their raids, authorities found printing machines, paper materials, inks, cigarette filters and grated tobacco leaves, among other paraphernalia. OPMC reportedly could produce 500 cigarette packs per day.

    The Philippines lose an estimated PHP100 billion ($1.84 billion) in tax revenues due to fraud each year, according to fiscal authorities.

  • Traders Hit With Tax-Evasion Charges

    Traders Hit With Tax-Evasion Charges

    Image: natatravel

    The Philippines’ Bureau of Internal Revenue (BIR) has filed 69 complaints for tax evasion worth PHP1.8 billion ($32.25 million) against tobacco traders, reports Business World.

    During a nationwide raid in January, authorities confiscated numerous countless cigarette products.

    “This is a warning against all illicit traders,” Internal Revenue Commissioner Romeo D. Lumagui Jr. was quoted as saying. “The BIR will not only raid your stores and warehouses, but we will also file criminal cases against you. This will not be the last.”

    According to Lumagui, the widespread peddling of illegal tobacco products is hampering government efforts to meet its excise tax collection target of PHP352.9 billion this year.

    Lumagui said his agency would partner with online platforms and merchants to impose stricter guidelines on illicit cigarettes.

    Michael L. Ricafort, chief economist at Rizal Commercial Banking Corp., said the state should enforce stricter tax collection measures to reach its collection target this year.

    “Through intensified collections based on current tax laws, the government can further structurally increase its recurring tax revenue collections,” he said in a Viber message.

    The BIR set a collection target of PHP2.6 trillion this year, 11 percent higher than last year.

  • Manila Urged to Deprioritize Tobacco in Smuggling Fight

    Manila Urged to Deprioritize Tobacco in Smuggling Fight

    Photo: JoyImage

    A consumer group is urging the government of the Philippines to focus on food rather than tobacco in its anti-smuggling efforts, reports the Inquirer.

    “Given the rising prices of pantry basics like onions, the government is correct in taking steps to curb agriculture smuggling, but for some reason, some of our legislators would rather waste time picking on the tobacco industry,” said Simoun Salinas, spokesperson of Malayang Konsumer.

    “The issue here is food security. Food for the Filipinos should be the priority.”

    Senate Bill 1812 aims to amend Republic Act 10845—the Anti-Agricultural Smuggling Act of 2016—to include unprocessed and processed tobacco products in the same category as rice, sugar, vegetables, meat and other essential food products entitled to protection against smuggling. Under the act, large-scale smuggling of these products is considered “economic sabotage.”

    “Why give special treatment to tobacco products and why now?” asked Salinas. “Why prioritize tobacco and cigarettes when in fact they are vices that are harmful to our health especially to our children.”

    An explanatory note of the proposed bill stated that the “ultimate goal is safeguarding our farmers, consumers and the agricultural sector and attaining the goal of food security for the country.”

    Under the act, the penalty for economic sabotage and large-scale agricultural smuggling is a maximum of 20 years’ imprisonment and a fine that is twice the fair value of the smuggled product.