Senator Win Gatchalian has filed a resolution seeking to investigate revenue erosion due to smuggling of excisable products, including vape and cigarettes.

“Despite the efforts of various government agencies, illicit trade and smuggling of excisable products remain rampant across the country. And because of its far-reaching effect, it is imperative for the government to re-evaluate its approach in combating smuggling and illicit trade in the country,” emphasized Gatchalian as he filed proposed Senate Resolution 1243.  

According to the Department of Finance (DOF), the government is losing P52 billion annually in potential revenue from smuggling of vape and tobacco products. Of the amount, the government incurred P35 billion in lost revenues due to smuggling of tobacco products and P17 million due to smuggling of vape products. 

In early November, the Philippine National Police Criminal Investigation and Detention Group (PNP-CIDG) confiscated P2.4 billion worth of counterfeit cigarettes and smuggled equipment. 

Last September, it was reported that Hong Kong Customs authorities intercepted USD18 million worth of smuggled wine bound for the Philippines. 

From October 2023 to August 2024, the Bureau of Customs (BOC) confiscated P6.5 billion worth of smuggled vape products. At the Philippine Vape Festival Compliance Summit held in August this year, the Bureau of Internal Revenue (BIR) also confiscated more than 5,000 illicit vape products even though the event was supposed to be an avenue for discussion about current regulation and policy changes pertaining to the industry. 

Further, the BIR also confiscated 390,000 liters of ethyl alcohol for non-payment of excise taxes amounting to more than P700 million in July this year.  

“It is important to note that smuggling and illicit trade are not victimless crimes. Aside from reducing government revenues, they also undermine the rule of law, fuel corruption, impair the competitiveness of legitimate businesses while becoming a major source of income for organized crime groups, and taint the reputation of our country in the global scene,” Gatchalian said. 

“Kailangan nang matuldukan ang smuggling ng mga excisable products na dapat sana’y pinagkakakitaan ng gobyerno dahil malaking kabawasan ito sa pondo na dapat ay nakalaan sa mga proyekto na makakatulong sa ating mga mahihirap na kababayan,” he concluded.