Heated tobacco, vape tax take hits P630.6M
The government’s revenues from sin taxes on new smoking devices increased by more than half last year amid the product’s growing popularity, data from the Department of Finance showed on Wednesday.
From January to December 2022, the total collection of excise taxes on heated tobacco and vapor products increased by 66 percent to P630.6 million, compared to P379.48 million in the previous year.
Based on data from the DoF, the excise tax on heated tobacco reached P413.28 million in 2022, that is 70 percent higher than the P242.88 million collected in 2021.
The excise taxes imposed on vapor products amounted to P217.33 million or a 27 percent increase from the P136.6 million collected the previous year.
Tax collection on heated tobacco, vapor products
The Bureau of Customs’ tax collection on heated tobacco and vapor product dropped 12 percent last year to P113.48 million from P129.64 million a year earlier.
DOF data show that Customs excise tax collection on vapor products declined by 39 percent from P129.64 million to P79.1 million last year.
On the other hand, heated tobacco importers paid the Customs bureau P34.37 million in excise taxes last year from zero payment in 2021.
BIR collection in excise tax
Meanwhile, the Bureau of Internal Revenue collected a total of P517.13 million in excise tax from the two smoking devices, which is twice the amount of P249.83 million collected in 2021.
Of overall tax collections by the BIR, the revenue generated from heated tobacco was a 56 percent improvement, reaching P378.9 million compared to P242.88 million in the previous year.
In the case of vapor products, these contributed P138.22 million in excise taxes to the BIR, marking a significant increase compared to the mere P6.96 million recorded in 2021.
BIR Commissioner Romeo Lumagui Jr. has acknowledged that the bureau’s excise tax collections in the first four months of the year did not meet the target due to the widespread illegal cigarette trade in the country.
Entities in the online marketplace
To tackle this problem, Lumagui expressed his intention to collaborate with other entities, specifically in the online marketplace, to eliminate the sale of illicit products on their platforms.
In the Philippines, online platforms have emerged as new channels for dishonest individuals who persist in engaging in the illicit trade of cigarettes.
“We’re coordinating with them and hopefully we come up with an agreement soon as to how to address the proliferation of illicit products in their platforms,” Lumagui said.
The BIR also reminded the public that the sale of cigarettes and vape products below the new floor price is illegal.
Read more Daily Tribune stories at: https://tribune.net.ph/
Follow us on social media