Bureau of Internal Revenue (BIR) Commissioner Romeo Lumagui Jr. today lead the agency’s first-ever simultaneous nationwide trade enforcement exercise against perpetrators of illicit cigarette trade, placing all regional enforcers on alert while conducting operations on 378 stores in Luzon, Visayas, and Mindanao.
“Let me make this clear to you illegal traders. This is just the beginning of our simultaneous nationwide operations. We are serious in our crackdown against illicit cigarette trade. We will be strict on implementing the law from hereon,” Lumagui said.
Authorities made good on their earlier declaration of war against unscrupulous traders as teams swooped down on 21 provinces, 69 cities and municipalities nationwide, specifically wholesalers and retailers selling illicit cigarettes and confiscated millions worth of illegal cigarettes that are untaxed, fake and smuggled.
The government loses as much as P100 billion in tax revenues from the illicit tobacco trade, funds meant to underwrite basic services, including the Universal Health Care program and other national development goals.
The BIR chief thanked the cooperation and the assistance extended by the Philippine National Police (PNP) and various local government units in their successful operations but at the same time lauded all the BIR regional officials in their concerted efforts.
The day’s synchronized enforcement all over Luzon, Visayas and Mindanao is the first time for the BIR chief in tandem with the OIC-Deputy Commissioner for Operations Maridur Rosario, the respective revenue regional directors, regional investigations chiefs, and revenue officers.
Various Revenue regions in Luzon held a total of 195 in simultaneous trade enforcements in Pangasinan, Nueva Ecija, Tarlac, Zambales, Pampanga, Bulacan, Palawan, Rizal, Cavite and in Manila. Authorities have launched 115 in Mindanao and 68 in Visayas.
In terms of the number of municipalities, Zambales, Pangasinan, Negros Oriental, Eastern Samar, Agusan del Sur, North Cotabato and Davao del Sur reported the highest number of simultaneous raids.
But overall, Zamboanga City had the highest number of trade enforcements in a single locality with 38 operations. Records show that Zamboanga City has been consistently in the list of “hotspot areas” in terms of cigarette smuggling and sale of illegal cigarettes.
More than 100 raided stores were located in public markets selling various brands of illegal cigarettes at a wholesale price as low as P30.00 per pack. The BIR is now preparing the filing of appropriate charges against the store owners in violation of various offenses under the National Internal Revenue Code of 1997 and the BIR’s minimum price requirement, among others.
Stall owners face offenses for collection of taxes, including surcharges and penalties for all the violations of the Tax Code including, but not limited to Sec. 145 on violation on the Floor or Minimum Prices, Sec. 254 on Attempt to Evade or Defeat Tax, Sec. 258 on Unlawful Possession or Removal of Articles Subject to Excise Tax Without Payment of the Tax, Sec. 264 on Failure to Issue Receipts, Sec. 265 on Offenses relating to tax stamps.
Under the BIR Minimum Price requirement, which pegged the price of cigarettes at P82.49 per pack, violators face a six-year jail term and a fine of P500,000.
Penalties for violating Sec. 145 means a fine of not less than 10 times the amount of excise tax and the VAT due or not less than P200,000 but not more than P500,000. Sec. 254 requires a fine not less than P500,000 but not more than P10 million and an imprisonment of not less than six years but not more than 10 years.
Sec. 258, on the other hand, requires a fine of not less than P30,000 but not more than P50,000 and an imprisonment of not less than two years but not more than four years. Sec. 263 has a fine of not more than 10 times the amount of excise tax due on the articles found but not less than P1 million and imprisonment of not less than five years but not more than eight years. Sec. 264 gives a fine of not less than P1,000 but not more than P50,000 and imprisonment of not less than two years but not more than four years.
Lastly, Sec. 265 requires a fine of not less than P10 million but not more than P500 million and imprisonment of not less than five years but not more than eight years.
