BIR orders new tax stamps on all cigarettes and e-cigarettes as stamp fees remain suspended

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MANILA, Philippines — The Bureau of Internal Revenue (BIR) has ordered new tax stamps to be affixed to all cigarettes, e-cigarettes and vapers despite still unresolved issues regarding the cost of stamps to traders.

Tax Commissioner Caesar Dulay and Finance Secretary Carlos Dominguez III released Tax Regulation (RR) No.18-2021 released Tuesday, September 14, which consolidated the rules on domestic tax stamps affixed to all imported and locally produced tobacco, heated tobacco. and steam products for domestic sale or export.

Products with revenue stamps meant that the correct excise duties had been paid by manufacturers and importers prior to sale.

The BIR was currently implementing the improved integrated system of internal fiscal stamps (Irsis), which upgraded to a web application its information system managing the order, production, distribution, affixing, control as well as the follow-up of tax stamps on cigarettes.

Implemented since March, the strengthened Irsis was supposed to be “an effective means of preventing the proliferation of illicit trade in tobacco products,” the BIR said.

But deputy commissioner Arnel Guballa told the Inquirer on Tuesday that the BIR was still working out issues related to the cost of new tax stamps to be produced by the state-run APO Production Unit Inc.

Under RR 18-2021, revenue stamps will cost 20 centavos each, payable by importers and manufacturers. But Guballa said it was still “under review”.

The Philippine Tobacco Institute (PTI) industry group earlier this year opposed APO’s plan to increase the cost of the tax stamp on cigarettes by the current 15 centavos, claiming the government printer only wanted to double its benefits.

The last price adjustment was made in 2018, from 13 centavos per stamp when the Irsis project started in 2014 to collect the correct excise duties on cigarettes.

PTI, which brings together domestic cigarette manufacturers, exporters and tobacco leaf suppliers, had called for a “reasonable” two centavo increase in the price of the new cigarette tax stamps.

In the past, unscrupulous traders were able to produce fake stamps, resulting in lost revenue for the government. The BIR responded by designing new and improved stamps with more security features to prevent counterfeiting.

RR 18-2021 required the advance payment of excise duties before manufacturers and importers could order revenue stamps.

Under Republic Law (RA) No 11346 or Tobacco Tax Law 2019, excise duty on cigarettes increased to P50 per pack as of January 1, 2021, from P45 per package in 2020.

For electronic cigarettes, the RA 11467 signed by President Rodrigo Duterte in 2020 slapped P 27.50 per excise packet on heated tobacco products this year, up from P 25 per pack in 2020.

Also under RA 11467, the excise rate on conventional free-base steam products increased to P 50 per milliliter in 2021, from P 45 per ml in 2020.

With regard to nicotine salt vapers, the sample has also increased from 37 P per ml to 42 P per ml, under the RA 11467.

BST

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