MANILA, Philippines—The Supreme Court on Wednesday declared as constitutional a provision of the National Internal Revenue Code (NIRC) which levies higher taxes on cigarette brands that entered the market after 1996.

The high court en banc unanimously affirmed the constitutionality of Section 145 of the NIRC that levies new cigarette brands at their current net retail price and existing brands at their net retail price as of Oct. 1, 1996.

It also nullified two regulations imposed by the Bureau of Internal Revenue to implement the NIRC provision which empowered the bureau to reclassify or update cigarette brands every two years or so.

The case arose from a suit brought in 2003 by the British American Tobacco (BAT), the manufacturer of Lucky Strike Filter, Lucky Strike Lights and Lucky Strike Menthol Lights brands, against the tax code provision and the BIR regulations which it said violated the equal protection and uniformity clauses of the Constitution.

After the Makati court upheld the constitutionality and validity of the NIRC section and the two BIR regulations, the BAT elevated the case to the high court.

In its ruling, the high court said the questioned provision did not violate the equal protection clause as it addressed Congress’ concern not to give too much authority to the tax implementers to avoid potential abuse and corruption. Jerome Aning