Cameras to monitor tobacco plants

Internal Revenue Commissioner Kim Henares. INQUIRER FILE PHOTO

The Bureau of Internal Revenue (BIR) will require all tobacco companies to install closed-circuit television cameras in its production lines and warehouses so the government can monitor their production and ensure the payment of correct taxes.

BIR Commissioner Kim Jacinto-Henares said the move covers all cigarette makers, including market leader Philip Morris Fortune Tobacco Corporation (PMFTC) and rival Mighty Corporation (MC). It came in the wake of the seizure recently of large cache of untaxed cigarettes, or those without the required strip tax stamps, during raids on various distribution and retail outlets in Batangas City and Talavera, Nueva Ecija, by anti-tax fraud agents a few weeks ago.

Ms. Henares did not say where the seized goods came from.

She instructed the BIR’s large taxpayers service and tax fraud division to investigate and establish the sources of the contraband and to check if they were produced locally or smuggled from abroad.

Henares said the rule requiring all tobacco firms to install CCTVs at their plants would be included in the revenue regulation she will issue soon.

The BIR had earlier installed CCTVs at the factory of Mighty Corporation, the main business rival of PMFTC, in its Bulacan plant. Ms. Henares said the equipment are very expensive and cigarette companies should buy them at their own expense.

None of the tobacco companies could be reached at press time.

But in a press release and print ads issued two weeks ago, the PMFTC reminded all cigarette wholesalers and retailers that it is illegal to purchase cigarettes without the required tax stamp.

“We will do all we can to support the success of the tax stamp system to ensure 100% tax paid compliance by all manufacturers,” it said.

Under BIR revenue regulation No. 7-2014, all cigarette packs, whether locally manufactured or imported, must have tax stamps as of April 1, 2015.–With a report from Ben de Vera