Tag: Philipinnes

  • Calls for Crackdown on Illicit Vapes

    Calls for Crackdown on Illicit Vapes

    Photo: niroworld

    The Philippine Tobacco Industry (PTI) has called on the Philippines’ Bureau of Internal Revenue (BIR) to crack down on illicit vapor products, reports The Manilla Times.

    In a letter sent recently to BIR Commissioner Romeo Lumagui Jr., the group emphasized that the full implementation of the Vaporized Nicotine and Non-Nicotine Products Regulation Act “will ensure that the public is protected against the dangers of using illicit products as well as the collection of appropriate taxes aimed at helping our economy.”

    The act, which became law in July 2022, regulates the importation, manufacture, sale, packaging, distribution, use and communication of vaping products such as e-cigarettes and heated-tobacco products.

    Under the laws implementing rules and regulations (IRR), e-commerce platforms, e-marketplaces and other similar online platforms are mandated to allow only Department of Trade and Industry and BIR-registered distributors, merchants or retailers of vape products, devices and novel tobacco products to sell on their website or platform.

    To ensure vape products are made inaccessible to minors, the IRR also requires vapor product refill receptacles to be tamper-resistant and child-resistant. Products packaged or labeled with flavor descriptors appealing to minors are prohibited.

    “We are also hoping that the BIR will closely work with enforcement agencies such as the Philippine National Police, the Armed Forces of the Philippines as well as relevant anti-illicit trade groups from the Bureau of Customs to make sure the law and its IRR are effectively implemented,” the PTI said.

    The PTI members include Japan Tobacco International Philippines, Associated Anglo-American Tobacco Corp. and Philip Morris Fortune Tobacco Co.

  • Vape Merchants Must Register with BIR

    Vape Merchants Must Register with BIR

    Image: Tobacco Reporter archive

    The Philippine Bureau of Internal Revenue (BIR) has requested that vape merchants register their businesses to avoid serious consequences in the future, reports the Manila Bulletin.

    Criminal tax evasion charges will be filed against merchants that do not comply with revenue regulations, according to BIR Commissioner Romeo D. Lumagui Jr. Tax evasion charges were previously brought against five major importers and distributors of vapor products, totaling over PHP1 billion ($18.2 million).

    Under the law, first-time offenders face a fine of PHP2 million and up to two years in jail. Second-time offenders face a fine of PHP4 million and up to four years in jail. Third-time offenders face a fine of PHP5 million and up to six years in jail. Foreign nationals caught breaking the law would face immediate deportation after serving the appropriate jail term.

  • Smoking Prevalence Down in the Philippines

    Smoking Prevalence Down in the Philippines

    Photo: junpinzon

    The share of tobacco use among Filipinos aged 15 and above decreased to 19.5 percent of the population in 2021, reports GMA News Online, citing results of the 2021 Global Adult Tobacco Survey (GATS).

    Vito Roque Jr. of the Department of Health’s (DOH) Epidemiology Bureau attributed the decline to the adoption and implementation of tobacco prevention and control health policies and interventions. “The results also reflect the effectiveness of the enforced key policies on tobacco taxation, graphic health warnings, protection of bureaucracy against tobacco industry interference and smoke-free environments,” he added.

    Rising cigarette prices may have played a role as well. In 2009, a cigarette pack in the Philippines cost on average PHP30 ($0.54). By 2021, this figure had increased to PHP100 per box.

    Based on the 2021 GATS results, one in every five Filipino adults, or 15.1 million adults, currently use tobacco, among whom the percentage of males (34.7 percent) who currently use tobacco was eight times higher than females (4.2 percent).

    Meanwhile, at least 11.2 million adults currently smoke daily, or about 14.5 percent of the adult population. The percentage of male smokers who smoke daily (26.3 percent) is nearly nine times higher than the percentage of women smokers who smoke daily (3.6 percent).

    The average number of cigarettes smoked per day among daily cigarette smokers was 10.5 sticks, with men smoking a daily average of 10.8 sticks and women 6.7 sticks.

    The survey said that the overall prevalence of those who have ever used e-cigarettes among all adults was 5.7 percent while the current use of e-cigarettes was 2.1 percent.

  • Lawmakers: Tobacco Smuggling is ‘Sabotage’

    Lawmakers: Tobacco Smuggling is ‘Sabotage’

    Photo: Mykhailo Polenok – Dreamstime.com

    The Philippine House Committee on Agriculture and Food has approved legislation that aims to declare the smuggling of raw tobacco, cigarettes, cigars and heated-tobacco products as economic sabotage, reports the Manilla Bulletin.

    The bill seeks to include unprocessed and processed tobacco in the Anti-Agricultural Smuggling Act’s definition of “agricultural commodities.”

    “Every revenue lost from illicit tobacco trade deprives the country of much-needed funds to support various programs of the government, especially the economic program of tobacco-producing provinces as well as general appropriations for education and other social welfare programs,” said Senior Deputy Majority Leader Sandro Marcos, principal sponsor of the bill.

    According to Marcos, the tobacco industry provides livelihoods to 2.2 million Filipinos, including 516,000 farmers and workers. In 2020, it accounted for around 6 percent of tax revenue and 58 percent of sin tax revenues. From April to June 2022, production of tobacco dried leaves reached 36,038 metric tons with the Ilocos Region accounting for 24,020 metric tons, or 66 percent of the total production.

    Smuggling threatens not only the livelihood of tobacco farmers but also causes the government to lose out on PHP26 billion ($452.84 million) in tax collections annually, according to Marcos.

    From 2019 to January 2022, the Bureau of Customs (BOC) confiscated 87,430 illicit master cases each containing 10,000 cigarettes. The Bureau of Internal Revenue (BIR) seized 46.1 million packs of cigarettes from 2018 to 2021 and 47 million counterfeit tobacco excise tax stamps from 2018 to 2022.

    The BOC estimated that the government lost PHP3.7 billion in tobacco excise taxes from 2018 to 2021.

    Former Representative Jericho Nograles said the smuggled items confiscated by authorities “are only the tip of the iceberg.” He said smuggling is also a national security issue because it involves the porosity of the country’s borders.

    Under the Philippines’ current law, companies or people caught in possession of untaxed tobacco products face prison terms of up to 12 years. The proposed legislation seeks to increase the maximum prison sentence to 40 years without bail. This would be on top of paying fines double the value of the seized smuggled items plus the total amount of unpaid duties and other taxes.

  • Philippines Tax Service Sets ENDS Floor Prices

    Philippines Tax Service Sets ENDS Floor Prices

    Photo: MilletStudio

    The Philippine Bureau of Internal Revenue (BIR) has set a floor price for heated, vapor and other electronic nicotine-delivery devices, reports ABS-CBN News. 

    The floor price for a 0.7 mL pod of nicotine is PHP131.04 ($2.29). For 1.8 mL and 1.9 mL nicotine salts, the minimum prices are PHP306.88 and PHP318.08, respectively.

    Meanwhile, the floor price for a 15 mL bottle of conventional freebase nicotine is PHP207.2. A bottle that contains 30 mL of classic nicotine has a PHP352.8 minimum price. 

    According to BIR East NCR director Edgar Tolentino, the new guidelines will help the economy and protect the health of minors. 

    “BIR will have exclusive jurisdiction over taxpayer registration, setting the products’ floor price, drafting and publication of revenue regulations covering vape items,” Tolentino said. 

    He also said the newly appointed BIR Commissioner Romeo Lumagui Jr. has a mandate to crack down on illicit vape traders. 

    “We need to support the plans of the commissioner; one thing is to focus on illegal vape sellers because if smuggling persists, we will be losing huge revenues from vape products,” he said. 

    Since 2019, the government has collected about PHP15.3 billion in vape taxes. 

  • PMFTC Vows Support for Filipino Farmers

    PMFTC Vows Support for Filipino Farmers

    Photo: PMFTC

    Philip Morris Fortune Tobacco Corp. (PMFTC) plans to spend more than $100 million on leaf from Filipino farmers over the next few years, reports Business World Online, citing company officials.

    “While dependent on tobacco industry dynamics and the government’s excise tax policies, we anticipate spending approximately $130 million for more than 45,000 tons of Philippines green tobacco leaf over the next three years,” said PMFTC President Denis Gorkun in a letter addressed to the secretaries of Finance and Agriculture departments.

    According to Gorkun, Philippine leaf production has been falling in the wake of recent tax hikes on tobacco products and the expected surge in the illicit trade of cigarettes because of an increase in prices.

    A new round of excise tax increases on tobacco and vapor products took effect this year after Republic Act No. 11467 was signed into law in January.

    PMFTC sourced 43 percent of its leaf purchases from local farmers in 2019, both directly and through suppliers.

    PMFTC is also contemplating a $1 million investment to boost the National Tobacco Administration’s capacity to test aerosols and check product compliance.

    The company will continue its program that helps 15,000 tobacco farmers in tobacco-producing provinces become more competitive, said Gorkun.

    “We would also like to take this opportunity to assure PMFTC’s support for reasonable regulations applicable to tobacco products. The development of balanced and fair regulations will not only protect the interest of various stakeholders but also ensure the sustainability of the tobacco industry and the livelihood of our Filipino tobacco farmers, especially with the economic challenges we are facing today,” he said in his letter.

    Finance Secretary Carlos G. Dominguez III and Agriculture Secretary William D. Dar earlier asked tobacco manufacturers to buy more from local farmers and help the industry recover from the impacts of the coronavirus disease 2019 (COVID-19) pandemic.

    The lockdowns and other restrictions imposed to curb the spread of the disease has affected the flow of agricultural goods including tobacco.

    Japan Tobacco International on Monday said it would increase its purchases of Philippine tobacco to 4.6 million kg next year.

    Philippine law requires tobacco companies in the country to buy at least 15 percent of their leaf requirements from local farmers. 

  • Philip Morris Opens IQOS Stores in Manila

    Philip Morris Opens IQOS Stores in Manila

    Photo: Alpar Benedek | Dreamstime.com

    Philip Morris Fortune Tobacco Co. (PMFTC) is opening its first four IQOS stores in Manila, reports The Manilla Standard.

    While the heat-not-burn product has been available in the Philippines through several retail outlets since April, the opening of the stores marks a significant step towards achieving the company’s vision of a smoke-free future, according to PMFTC President Denis Gorkun.

    “PMFTC’s vision is to help adult smokers who would otherwise continue to smoke to move away from cigarettes as quickly as possible and switch to a better alternative,” Gorkun said.

    PMFTC parent company Philip Morris International has invested more than $7 billion in research, development and production capabilities to create smoke-free products such as IQOS, which are now available in several countries.

    In July, the U.S. Food and Drugs Administration (FDA) authorized the marketing of IQOS and heat sticks in the U.S. with a reduced exposure claim adding that such issuance is appropriate for the promotion of public health.

    Gorkun said the FDA decision shows that IQOS is a fundamentally different tobacco product compared to cigarettes and a better choice for adults who would otherwise continue smoking.

    About 60 percent of Filipino adult smokers are willing to try smoke-free alternatives provided they are made commercially available and meet quality production standards, according to a study commissioned by PMFTC.

    PMFTC said IQOS is aimed at adult smokers. The company is implementing age verification and access restriction to ensure that only legal age consumers 21 years old and above will have access to the stores, the e-commerce website and the IQOS products.

  • Riley to replace Nelson as head of Philip Morris Fortune Tobacco

    Cigarette maker Philip Morris Fortune Tobacco Corp. will have a new president starting  May 1, taking the reins from Chris Nelson who is retiring effective on the same date.

    In an emailed statement, the company said Nelson will be succeeded by Paul Riley, another company veteran, as PMFTC president.

    “Chris has long expressed his desire to retire after 10 years in the Philippines with PMPMI (Philip Morris Philippines Manufacturing) and PMFTC and more than 27 years in Philip Morris International,” the PMFTC statement read.

    Nelson is a 32-year veteran in the tobacco industry. He will be retiring in the Philippines.

    Riley joined Philip Morris in Australia in 1988 and “assumed roles of increasing responsibility” in Hong Kong, Thailand, Japan and recently as managing director of  the PMI affiliate in the Republic of Serbia, Montenegro and Central Europe South.