Retailers eyed in drive vs fake tax stamps

The Bureau of Internal Revenue (BIR) is seeking the cigarette industry’s support for a proposed agreement among stakeholders to combat the proliferation of fake tax stamps in the market.

The BIR is also expected this week to come out with its report on the raids conducted in General Santos City and Pampanga last week that yielded more than 36 million packs of cigarettes manufactured by homegrown Mighty Corp. bearing fake tax stamps, depriving the government of excise taxes exceeding P1 billion.

Internal Revenue Commissioner Caesar R. Dulay told industry players during a meeting last Friday that the BIR was considering a tripartite agreement with the Philippine Retailers Association (PRA) as well as cigarette manufacturers and importers in relation to the problem of counterfeit stamps.

“It’s like a pledge of support that they’re willing to cooperate to address the problem,” Dulay explained to reporters after the meeting.

Asked if the proposed agreement could slap sanctions to those who would not cooperate and would still be found using fake cigarette tax stamps, Dulay said the BIR would have to first discuss this with industry players. “Perhaps we could [come out with sanctions], based on industry feedback,” the BIR chief said.

Dulay noted that industry players were all aware that there was a proliferation of fake stamps.

“Not only [the BIR’s collections] but also the compliant companies will be affected, if you have a competitor with fake stamps in their products,” Dulay said.

Dulay said the BIR has yet to determine where the counterfeit stamps came from, but when asked if it was also possible that cigarette firms themselves could be in the know, he said it was possible.

The BIR chief said he was still validating the reports coming from the regional offices that conducted last week’s raids.

“I have to come out with the official report within seven days,” he said.

The Bureau of Customs, whose joint team with the BIR spearheaded the raids, earlier confirmed that all of the Mighty cigarette packs they confiscated bore fake tax stamps.

Based on initial findings, the BOC and the BIR seized 11,000 master cases of Mighty cigarettes worth P215 million in market value in General Santos City on top of 62,000 master cases worth P1.96 billion in San Simon, Pampanga. In all, there were 36.62 million packs and at an excise tax of P30 a pack, meant foregone revenues for the government of P1.098 billion.

Besides the tripartite agreement, the BIR also proposed the creation of enforcement teams, regular monitoring of factories and warehouse through the reassignment of revenue officers on-premise as well as institutionalizing a CCTV monitoring system.