MANILA, Philippines – The Department of Finance (DOF) is open to the idea of implementing a minimum floor price on cigarettes to prevent tobacco manufacturers to sell at a loss.
Finance Undersecretary Jeremias Paul Jr. said having a minimum price for cigarettes will be looked into as it may also boost government’s campaign in curbing tobacco consumption.
Bureau of Internal Revenue Commissioner Kim Henares earlier said a law will be needed to ban cigarette firms to sell at a loss.
“We’re okay with it,” Paul said of the proposal, adding that many tobacco manufacturers will also be open to it.
“In fact, the industry is open to it…But it’s too early to discuss the minimum potential revenue from this [measure] because we’ll have to wait for the review, there are technical details that we need to look at,” he said.
Paul also said allegations of rival cigarette firms on underdeclaring actual production volume is being monitored by authorities.
“They are under a close watch,” Paul said. “I understand Customs and BIR are investigating that, however, I’m not privy to the investigation details.”
Marlboro cigarette maker Philip Morris Fortune Tobacco Corp. (PMFTC) Inc. has urged government to address illicit trade in the domestic market, which resulted in an estimated loss of P15.6 billion in revenues in 2013.