TWO factories equipped with modern machines in Cavite province were found producing millions of packs of fake cigarettes that do not meet government standards and evade tax payments, according to government operatives.

Joint forces of the Bureau of Internal Revenue (BIR) and the National Bureau of Investigation (NBI) said they confiscated P358 million worth of fake cigarettes from two factories and a warehouse operated by Chinese nationals in Cavite on Thursday.

The raiding teams discovered 3.12 million packs of illicit cigarettes and eight illegal cigarette-making and packing machines in simultaneous raids in Dasmarinas City and Indang, Cavite.

The operation is part of the directive given by BIR Commissioner Romeo Lumagui Jr. to intensify the campaign against illicit cigarettes and plug the billions of pesos lost by the government to the illegal activity, according to Eric Diesto, BIR regional director for Revenue Region No. 9A or CaBaMiRo.

CaBaMiRo is the revenue district that covers the provinces of Cavite, Batangas, Oriental Mindoro, Occidental Mindoro and Romblon.

“This not only poses a threat to public health but also has a significant negative effect on the economy,” Diesto added.

The government operation stemmed from surveillance conducted by the NBI to identify organized crime operations. Acting on intelligence provided by the NBI, the BIR issued mission orders to proceed with the raids.

“This concerted effort aims to thwart illegal operations by organized crime syndicates, especially those involving foreign nationals, and to protect our people from the harmful effects of illegal cigarettes,” said Jesus Manapat, chief of the NBI Intellectual Property Rights Division (IPRD).

“By putting a stop to the selling and manufacturing of illegal cigarettes, we are also hoping to help bolster economic activities, employment and provide our local farmers with better opportunities,” Manapat said.

The raids are part of the government’s intensified campaign against the proliferation of illegal cigarettes, which cost the government P50 billion to P100 billion in lost tax revenues annually, according to the BIR.

The raiding teams confiscated 1.6 million packs of illicit cigarettes worth P184.7 million from a warehouse in Dasmarinas. The Indang factory yielded another 1.1 million packs of illicit cigarettes worth P126.6 million, along with two cigarette-making machines and two cigarette-packing machines.

A separate factory in Dasmarinas housed two cigarette-making machines, two cigarette-packing machines and stored 408,000 packs valued at P46.76 million.

Each machine line can produce 175 packs per minute or up to 43.7 million packs a year, translating to about P2.7 billion in lost basic excise tax revenues if illegal production continued, according to estimates.

The seized brands included Carnival, HP, Troy, Cannon, Victor Agila, New Orleans, Two Moon and Fort, all unregistered with the BIR and lacking tax stamps and the mandatory Department of Health graphic health warnings.

Authorities are continuing the investigation as 12 Chinese nationals were reportedly manning the illegal activity. The land and buildings were leased to them, the raiding teams said.

The raids were the culmination of the series of surveillance by the NBI to weed out organized crimes. Acting on the intelligence provided by NBI, the BIR issued mission orders to proceed with the operations.

Diesto said the Cavite raids are among the many BIR and law enforcement operations against illegal activities. “The government is serious about the fight against illicit tobacco trade, and we are doing everything to follow the mandate of the President to go after criminals,” he said.