Tobacco group urges tax adjustment to curb illicit trade

The Philippine Tobacco Institute (PTI) is urging the government to adjust tobacco tax rates to combat the escalating illicit trade.

PTI President Jericho Nograles stated that illicit tobacco has significantly grown, with smuggled cigarettes selling for as low as P40 per pack compared to legal ones priced at P140.

He argues that automatic annual tax increases widen the price gap, pushing consumers to cheaper illegal products instead of quitting.

Nograles believes that calibrating tax rates to an optimal level and enhancing enforcement could improve public health and government revenues.

The call comes as the Senate Committee on Ways and Means prepares to discuss House Bill 11360, which proposes changes to the current five percent annual increase in tobacco excise taxes.

Republic Act 11346 mandates a 5 percent annual excise tax increase on tobacco products, with half allocated to the Universal Healthcare Program.