Retailers caught in a bind as government cracks down on fake cigarette stamps


Posted at Mar 15 2017 08:19 PM

MANILA — A supermarket group wants authorities to issue clear guidelines, as its members look for ways to cooperate with the government in its ongoing crackdown against cigarette products carrying fake tax stamps.

Steven Cua, president of the Philippine Amalgamated Supermarkets Association (PASA), said association members are becoming "innocent victims" in the government's ongoing efforts against unscrupulous tobacco manufacturers.

On Wednesday, three retailers in Manila were caught possessing cigarettes without the requisite internal revenue stamps. They have been charged for non-payment of excise taxes by the Bureau of Internal Revenue (BIR).

"Right now, the government has not issued any pronouncement on how to go about the alleged illicit Mighty products," Cua said in an interview. "Until there's an instruction to stop selling from the government, it's going to be business as usual."

Finance Secretary Carlos G. Dominguez III said he has already instructed BIR Commissioner Caesar Dulay to issue guidelines on how cigarette retailers can cooperate with government authorities.

Dominguez also urged retailers to call the BIR if they have an inventory of Mighty cigarettes.

Cua acknowledged that retailers continue to accept cigarette products from Mighty Corp., saying "we're assuming the good government is checking the legitimacy of all products that come out of Mighty factories."

He also added that retailers aren't capable of checking if the cigarette packs sold to them by Mighty Corp. are affixed with genuine tax stamps.

However, Cua said they will stop selling Mighty cigarettes if there is an order from the Department of Finance, Department of Trade and Industry or the BIR.

Cua, meanwhile, is also appealing to government authorities to give retailers enough time to clear up their inventory of Mighty cigarettes before charging them.

"In the case of retailers, we have a very limited credit line with Mighty, most of us have already paid Mighty before the cigarette packs are sold to consumers, so we're becoming the innocent victims here," Cua said.

"If we're caught by authorities with fake stamps, there is no way we can get our money back from Mighty."

On Wednesday, the BIR filed separate criminal complaints with the City Prosecutor's Office of Manila against three cigarette retailers for unlawful possession without payment of the tax.

According to the BIR, the retailers violated Section 263 of the National Internal Revenue Code of 1997, as amended (Tax Code).

"We have no way of finding out if this product is legitimate, we need a clear guidance from authorities saying do not accept this particularly product," Cua said.