HOUSE Assistant Majority Leader and Puwersa ng Bayaning Atleta Party-list Rep. Margarita Migs Nograles has lauded the swift action of the House Representatives in approving House Bill (HB) No. 3917 which seeks to make cigarette smuggling a heinous crime.

Voting 245-0, the House has approved the passage of HB 3917 which seeks to impose tougher penalties against tobacco smuggling by amending some provisions of Republic Act (RA) No. 10845 or the Anti-Agricultural Smuggling Act of 2016.

The bill was authored by Nograles and presidential son and Senior Deputy Majority Leader Ilocos Norte Rep. Sandro Marcos.

HB 3917 seeks to amend Sections 3 and 4 of RA 10845 to include tobacco — whether manufactured or manufactured including finished products such as cigars, cigarettes, or heated tobacco— as an agricultural commodity.

It also seeks to declare tobacco smuggling as economic sabotage punishable with life imprisonment and a fine of twice the fair value of the smuggled agricultural product and the aggregate amount of the taxes, duties, and other charges.

“I’m really happy that we were able to pass this measure before the Christmas break. Me and Congressman Marcos are really hoping to provide some relief for our tobacco farmers who are suffering because of rampant cigarette smuggling,” Nograles said.

In his sponsorship speech before the bill’s approval, Marcos said that tobacco farming remains a primary source of livelihood for so many Filipino farmers despite the increase in excise taxes for the sale of tobacco products.

“Through this measure, we not only secure control of the tobacco market  within our country but also create a fool-proof legislative foundation that will allow for higjer  revenues to contibute in nation building,” Marcos said.

Marcos and Nograles pushed for the approval of the measure as they stressed that the tobacco industry remains a common source of income for many Filipinos which contributes to around 516,000 labor force in 2019 and around 2.2 million Filipinos generated earnings from the industry.

It also accounts for 6% of tax revenue in 2020, and 58% of so-called sin tax receipts are being used to finance the national health budget, including the universal health care resulting in 8 million more low-income families receiving health care under this program.

They noted that obacco production remains very high that from April to June 2022, production of tobacco dried leaves was estimated at 36.38 thousand metric tons, with Ilocos region as the top tobacco producer for the quarter, with 24.02 thousand metric tons or 66% share to the total tobacco production.

However, local tobacco farmers and legitimate tobacco product manufacturers are not only suffering economically because of the high excise tax imposed by the government but also because of the massive amount of tobacco products that are smuggled into the country by unscrupulous importers and traders.

The government is also losing billions in revenues because of the uncollected excise taxes from these smuggled tobacco products.

“The government revenues are lost from smuggled, unregistered, and unregulated cigarettes which are being sold via container vans shipments. This resulted in an estimated Php 26 billion in financial losses annually. If this continues, it will affect our local tobacco industry and roughly 2.2 million kababayans will be affected,” Nograles said.

Marcos and Nograles also noted that in some areas in the Philippines namely Zamboanga del Sur and Misamis Occidental, it is estimated that six out of 10 cigarettes sold in the market already come from illegal sources.

“Almost daily, there are new reports of seized illegal cigarettes by the Bureau of Customs in Mindanao and this is just the tip of the iceberg. Even in the tobacco-producing region of Ilocos, nearly 10% of the cigarettes sold are illicit,” Nograles said.