Tag: Philippines

  • Flava Pulled From Philippine Shelves

    Flava Pulled From Philippine Shelves

    Flava brand vaping products have been pulled from store shelves in the Philippines amid allegations of illegal marketing to minors and tax evasion, the Department of Trade and Industry has said.

    The DTI’s Fair Trade Enforcement Bureau (FTEB) on March 15 ordered Flava Corporation, Lilac’s Vape Shop, and social media influencer Lilac Sison Tayaban, CEO of Flava, to refrain from manufacturing, importing, selling, packaging and distributing imported Flava vapes, according to media reports.

    Once the Sampaloc, Manila-based business receives the preliminary order issued by DTI-FTEB, all of Flava’s commercial activities must immediately stop.

    Flava was the respondent to formal charges alleging violations of Republic Act No. 11900, or the Vaporized Nicotine and Non-Nicotine Products Regulation Act, filed before the DTI-FTEB on March 14.

    In turn, the DTI-FTEB gave the preliminary order to confiscate Flava products that violate RA 11900, to prevent the disposition or tampering of evidence and the continuation of the acts being complained of.

    The DTI is the lead implementing and enforcement agency of RA 11900, the landmark law aimed at protecting minors from vaping. The House Ways and Means Committee earlier estimated as much as P728 million ($1.3 million) in foregone tax revenues from the alleged technical smuggling of P1.4 billion worth of illicit Flava devices last year.

    After laboratory testing, The House panel discovered that Flava had not declared the vapes it imported from China. Flava allegedly mislabeled its ingredient as freebase nicotine, which has a lower excise tax than nicotine salt — the nicotine used in Flava products.

    Also, the House committee discovered Flava’s aggressive marketing of its flavored vapes to minors, most especially on social media—a violation of RA 11900. Last week, Bureau of Internal Revenue commissioner Romeo Lumagui Jr. disclosed that the taxman seized 1,029 master boxes of Flava vapes from a warehouse in San Pablo City, Laguna, with tax deficiencies totaling P75.7 million.

    The BIR raid conducted together with the Laguna provincial field unit of the Philippine National Police’s Criminal Investigation and Detection Group (PNP-CIDG) also led to the arrest of two individuals manning the warehouse.

    As such, the BIR will file criminal tax evasion charges against Flava.

    “This successful raid of a vape warehouse containing 102,900 bottles of Flava vape products will be one of many. The BIR supports the whole of the government’s approach to eradicating illicit vape products. We have warned you as early as 2022. Our raids are successful. We won the criminal cases. You already have pending warrants of arrest. Register and pay your proper taxes, or suffer the consequences,” Lumagui said.

    Meanwhile, Consumer Protection Group spokesperson, Trade Assistant Secretary Amanda Nograles said they will check the report of the Philippine Drug Enforcement Agency that marijuana-laced electronic cigarettes or vapes are now proliferating in the market.

    “That report alarms us, especially when these will be sold to minors. Since the information was just new, then we will get additional information. But the DTI will continue to confiscate vape products with flavor descriptors and have cartoon characters that are appealing to minors, and products that use influencers,” Nograles said in a radio interview.

    She said if the DTI encountered or confiscated vapes with marijuana oil, then they would refer it to the PDEA.

    On Thursday PDEA operatives seized cannabis oil and ‘kush’, and assorted vaping devices, with an estimated total value of P842,000 in simultaneous raids in Taguig City.

  • Health Department Building Case for Stricter Vape Rules

    Health Department Building Case for Stricter Vape Rules

    Image: Oleksii

    The Philippines Department of Health (DOH) is gathering data on vaping prevalence in the country, reports Malaya Business Insight.

     DOH Undersecretary Eric Tayag said the information will be used to convince policymakers to strengthen laws against vaping.

    According to the Global Youth Tobacco Survey (GYTS), e-cigarette users among the youth increased from 11.7 percent in 2015 to 24.5 percent in 2019.

    The DOH statement comes after nine former health officials called on the Philippine delegation to the 10th Session of the Conference of the Parties (COP10) of the World Health Organization Framework Convention on Tobacco Control (FCTC) to take the lead in pushing for the fight against vapes and electronic cigarettes.

    The former DOH secretaries and undersecretaries believe the Philippine delegation should speak about the serious threat to public health brought about by weak Philippine regulations on e-cigarettes and vapes.

  • Philippine Tax Reform Paid Off: Study

    Philippine Tax Reform Paid Off: Study

    Image: RODWORKS

    Repeated increases of “sin taxes” in the Philippines have not only driven down smoking prevalence, but also boosted the government’s health budget, reports The Philippine Star, citing a working paper published by the Institute for Leadership, Empowerment and Democracy.

    More than 10 years after the passage of the landmark 2012 Sin Tax Reform Law, the study found that sin tax reforms on alcohol, tobacco, e-cigarettes, vape and heated tobacco products have generated PHP1.1 trillion ($21.66 billion) in additional revenue above the 2012 baseline.

    The annual health budget increased six-fold to PHP309 billion in 2023 from PHP53 billion in 2013. Despite the higher taxes, cigarettes remain affordable, at PHP100 per pack and PHP5 per stick, according to the report.

    From 2012 to 2022, real value of tobacco production has grown by 6.6 percent. However, the researchers noted that these findings must be validated through individual-level surveys of tobacco farmers.

    Given the resilience of the tobacco business over the past decade, the author’s concluded that there is room for further tax increases.

  • Thailand Asked to Embrace Alternatives

    Thailand Asked to Embrace Alternatives

    Asa Saligupta

    The director of ENDS Cigarette Smoke Thailand (ECST) has asked the Thai government to pass legislation that encourages smokers to switch to less-harmful methods of nicotine consumption, reports The Inquirer.

    Asa Saligupta believes that Thailand’s current restrictions on smoking alternatives are pushing these products underground, resulting in an unregulated market that deprives the government of revenues and forces consumers to keep smoking.

    Thailand banned on vapes and other electronic nicotine delivery systems in 2014, resulting in the arrest of local vapers and foreign tourists. Saligupta says the measure has discouraged smokers from switching to potentially less harmful innovative products.

    According to Saligupta, Thailand should follow the lead of the Philippines, which passed a law that recognizes tobacco harm reduction as a legitimate tool in the campaign against smoking.

    Republic Act 11900, or the Vaporized Nicotine and Non-Nicotine Products Regulation Act, became law in 2022. The Vape Law regulates the importation, sale, packaging, distribution, use and communication of vaporized nicotine and non-nicotine products and novel tobacco products such as electronic cigarettes and heated tobacco products.

    Thailand’s vaping regulations are among the strictest in Asia.

  • New Proposal to Tackle Illicit Trade

    New Proposal to Tackle Illicit Trade

    Photos: Niroworld

    Joey Salceda, the chairman of the Philippine House of Representatives Ways and Means Committee, has proposed new legislation to tackle the illicit trade in cigarettes, reports the Philippine News Agency.

    Among other things, the measures would address smuggling through the country’s economic zones, leakage of tobacco declared for export or transshipment, and the manufacture of fake cigarettes.

    The illegal tobacco market has flourished in the Philippines recently. The government expects to miss out on PHP60.6 billion ($1.06 billion) in revenue this year if the illicit tobacco trade continues on its current trajectory.

    Salceda noted that 2022 tax collections declined by 7.8 percent to PHP160.4 billion and that the government missed its 2022 target of PHP191.6 billion by PHP31.2 billion.

    Salceda said that illicit cigarettes are “easy to come by” in every trade segment. “There is no challenge to buying these brands,” he was quoted as saying. “And they sell at as low as one-fifth the price of licit cigarettes. The legitimate ones don’t stand a chance. Even fakes of premium brands are becoming easier to come by. From the same online shopping sites, fakes that are half the price and supposedly of the same flavor are sold openly.

    “In the meantime, the revenue base will continue to shrink, and there is a chance that prevalence might actually increase as a result of cheaper illicit alternatives. This is a serious national crisis. For better or for worse, our advocacy of higher taxes played a role in making the illicit sector more attractive. We have a responsibility to help solve this problem,” he said.

  • Philippines Ag Dept. Supports Intercropping

    Philippines Ag Dept. Supports Intercropping

    Image: Yü Lan

    The Philippines’ Department of Agriculture (DA) and local government units in tobacco producing areas are urging intercropping on tobacco fields to give farmers extra income and to make up for lost markets caused by smoking concerns, according to the Philippine News Agency.

    High-value crops, such as rice, corn, garlic, onions, tomatoes and bamboo, can be planted alongside tobacco to help expand farmer income, according to DA Undersecretary Deogracias Victor Savellano. Intercropping will also help contribute to the Philippines’ food security.

    Despite changing views toward smoking and tobacco, Savellano stated that the Department of Agriculture along with the National Tobacco Administration (NTA) must sustain the domestic tobacco industry as it affects about 2.2 million Filipinos and their livelihoods.

    The domestic tobacco market generates billions in excise taxes annually, much of which funds the universal healthcare program.

    “The government cannot allow the tobacco industry to sunset despite changes in consumers’ attitude toward cigarettes. However, we are now focusing on the export market … to make up for any decline in revenues generated domestically,” Savellano explained.

    The NTA is pressing for more strict government responses to smuggling and other illicit tobacco activity. According to Robert Ambros, NTA regulatory head, government revenue loss due to illicit tobacco trade is estimated to be over PHP30 billion ($528.2 million) by the end of 2023.

    “These past years, we had seen so much change in our health policies that affected the tobacco industry,” said President Ferdinand R. Marcos Jr. in an August speech delivered on his behalf by his nephew, Ilocos Norte Governor Matthew Manotoc. “As such, we must seek ways to protect the livelihood of thousands of our tobacco farmers.”

  • Philippine Growers Urged to Plant More

    Philippine Growers Urged to Plant More

    Photo: Philip Morris Fortune Tobacco Co.

    Philippine Agriculture Undersecretary Deogracias Victor Savellano urged tobacco-producing provinces in Northern Luzon to increase production for export, according to the Philippines News Agency. The request followed a meeting with the governing board of the National Tobacco Administration (NTA).

    Savellano said that the NTA and farmers should boost tobacco production without sacrificing production of other crops, like rice, corn and other high-value crops.

    If the Philippines increases tobacco for export, the country can engage in barter-to-barter with Indonesia, which produces low-cost rice and fertilizer.

    In 2022, the Philippines exported 53 percent of tobacco produced while 47 percent was supplied to local tobacco manufacturers.

    “Aside from our aim to increase our tobacco production for export, we are also looking at the other alternative products from tobacco and its commercialization, like the tobacco dust,” Savellano said.

  • New Rules for Vape Supplier Imports

    New Rules for Vape Supplier Imports

    Image: globeds

    The Bureau of Internal Revenue (BIR) in the Philippines said it will require importers of raw materials for vaping products to seek special clearances to release their shipments.

    The agency cited the need to impose order on an industry with many emerging players, according to media reports.

    “For vape products, we are going to require them to (apply for) the authority to release imported goods for raw materials,” BIR Commissioner Romeo Lumagui Jr. said. “We are thinking of ways to regulate because there are so many vape products now. The production of vape products is a backyard industry, so we’re thinking of ways to regulate it.”

    In its latest revenue memorandum circular, the BIR announced that it is now requiring importers or manufacturers of raw materials and equipment used to make heated-tobacco products and vapor products to apply for an authority to release imported goods.

    “The raw materials specially used for the manufacture of heated-tobacco products and vapor products shall include but are not limited to propylene glycol, vegetable glycerin, organic sweetener, artificial flavoring and nicotine,” the circular states.

    Devices used for the manufacture of these products will also include but are not limited to mechanical or electric heating elements/atomizers, circuits, cartridges, reservoirs, pods, tanks, mods and mouthpieces.

    Apart from the authority to release imported goods, importers and manufacturers must also apply for a permit to operate. Lumagui said that the BIR is working on addressing the shortfall from excise tax collections, which is mainly due to illicit tobacco.

    “We’re targeting to minimize that 20 percent (shortfall). Within the year, we can cut that by more than half … ultimately, I want to make sure to fully resolve that shortfall,” he said.

  • Filipino Smokers Have Quit Options

    Filipino Smokers Have Quit Options

    no smoking
    Image: Tobacco Reporter archive

    Adult Filipino tobacco smokers who wish to quit should be given more alternatives to help them gradually decrease their nicotine consumption, a research group said, reports GMA News Online.

    ASCRA Consulting’s project coordinator, Joze Songsong, discussed tobacco harm reduction (THR) in a media forum, explaining that Filipinos need to be protected from the dangers of smoking and some need smoking cessation support.  

    “Through tobacco harm reduction, what we want to do is to empathize with those adult smokers who can’t immediately quit because either they use nicotine as a way to alleviate the different social circumstances that force them into this particular lifestyle or habit,” Songsong said. “What we want to do is not to advocate for a specific type of cure for these Filipino smokers but to equip them with the right information and the tools to make those informed decisions because these Filipino smokers have the right to informed choices and have the right to make choices for their own health.” 

    Ehsan Latif, senior vice president of the Foundation for a Smoke-free World, said that the Philippines should learn from the THR progress of other countries like Japan and the United Kingdom.

    “We can’t expect people to quit smoking in just a day. The challenge is how we interact with the private sector. It’s not dependent on one sect,” said Latif.

  • Philippines: Seized Cigarettes Destroyed

    Philippines: Seized Cigarettes Destroyed

    Image: Tobacco Reporter archive

    Seized fake cigarettes, raw materials and cigarette manufacturing machines were destroyed in a fire that affected three warehouses in Porac, Pampanga, Philippines, reports The Philippine Star. The items were worth about PHP4.8 billion ($86.8 million). The fire burned for 15 hours despite efforts from firefighters.  

    The Bureau of Customs and the Bureau of Internal Revenue had seized the destroyed items in raids across the country over the past several years. The warehouses were used as storage for what would later be used as evidence against suspects charged in court.  

    The warehouses are owned by Digama Waste Management Services and Greenleaf 88 Nonhazardous Waste Disposal.