BIR to summon tobacco firms on fake tax stamps

28 February 2017:

MANILA — The Bureau of Internal Revenue will summon cigarette firms to get to the bottom of the proliferation of fake tax stamps in the market.

BIR Commissioner Caesar R. Dulay told the Philippine Daily Inquirer Tuesday that the meeting will be held on Friday, March 3.

Earlier, Dulay said the BIR would meet with cigarette manufacturers amid its investigation on counterfeit tax stamps.

Dulay had said the BIR would launch new tax stamps with better security features by the second half of the year.  Earlier, Finance Secretary Carlos G. Dominguez said that counterfeiters had already copied eight features of the current tax stamps being churned out by government security printer APO Production Unit.

Dominguez had said the government might have to ask cigarette firms to shoulder the higher costs to produce the new tax stamps.

The BIR has issued letters of authority to investigate Bulacan-based Mighty Corp., while also expanding its investigation to cover all cigarette companies.

Early in February, the BIR seized products of Mighty that yielded fake cigarette tax stamps during inspection at a Cebu mall, even as the country’s largest tax-collection agency also inspected cigarettes of other domestic and foreign manufacturers.

A report furnished to Dulay showed that the BIR conducted inventory-taking at Metro Mandaue mall in Mandaue City on Feb. 7-8, pursuant to a Feb. 3 mission order issued to check the alleged proliferation of fake stamps in Cebu City earlier discovered by Irsis Corp.

In all, BIR personnel found 33 master cases of Marlboro cigarettes, 11 master cases of Fortune and seven master cases of Hope—products of market leader PMFTC Inc.; 19 master cases of Jackpot; as well as 164 master cases of Mighty products, on top of 902 loose packs of Mighty cigarettes.

“After checking the authenticity of the affixed stamps, it was discovered that all cigarette products bearing the Mighty brand of cigarettes registered a red-colored reading which indicated fake or counterfeit stamps used on their products,” according to the BIR report.

As such, the BIR seized the seven master cases of Mighty’s green hard menthol cigarettes, 58 master cases of the white soft menthol, and 99 master cases of the red full flavor.

Also, the BIR confiscated 337 loose packs of the green hard menthol variant, 362 packs of the white soft menthol, as well as 203 packs of the red full flavor of Mighty.

A master case contains 50 reams or cartons, while each ream has 10 packs.

At an excise tax of P30 per pack, foregone revenues from the confiscated products—a total of 82,902 packs—would reach P2.49 million.  SFM/rga