Tax stamp regulations on cigarette exports eased

The Bureau of Internal Revenue (BIR) will no longer require cigarette packs intended for export to be affixed with tax stamps.

Revenue Regulations (RR) No. 9-2015 issued by BIR Commissioner Kim S. Jacinto-Henares and Finance Secretary Cesar V. Purisima last Sept. 2 amended the provisions of Revenue Regulations No. 7- 2014, under which only tobacco firms that can provide a certification from the country of destination that their law prohibits the affixture of stamps had been exempted, Henares explained in a text message.

In lieu of the tax stamps, the BIR ordered that all tobacco products manufactured for export must have labels “stating clearly that the cigarettes are strictly for sale in the country of destination for which [they were] allowed to be manufactured for.”

The cigarettes to be exported must also bear labels that are “not similar in any way” to those sold locally, RR 9-2015 said.

Also, cigarette companies must provide proof that the products intended for export were actually shipped to the foreign country of destination, as evidenced by a certified true copy of the bill of lading and/or shipping manifest that clearly identifies the number of packs as well as brands of cigarettes shipped out.

The BIR said cigarette packs for export will still be provided with the range of unique identifier codes (UICs) of tax stamps, which will be released to the manufacturer.

Exporters must still pay P0.03 per UIC.

“The payment thereof shall be considered constructive affixture of the internal revenue stamps on such cigarettes for export, provided that the range of UICs that were released to the local manufacturer-exporter shall be reported to the BIR, through Irsis [Internal Revenue Stamps Integrated System],” according to RR 9-2015.

Last June, the BIR announced that it would “conduct on-the-spot surveillance of cigarette products either in the place of production, storage facilities, or in the domestic market, as the case may be, through the use of mobile verification devices issued for the purpose of ensuring compliance” with the Irsis on tobacco.

Irsis, which mandates affixing tax stamps on cigarette packs, aims to ensure collecting correct excise taxes on tobacco products.

“All manufacturers, importers and distributors of cigarettes are hereby reminded to strictly comply with the requirement of affixture of internal revenue stamps. All wholesalers and retailers are likewise reminded to purchase only cigarette packs with authorized tax stamps,” the BIR had said.

The BIR had also reminded consumers that “any cigarette pack in the market at this time without the requisite tax stamps are presumed to be untaxed and are considered as illegal products.”

The tax stamp system will also cover alcohol products before yearend, Henares had said. Ben O. de Vera