Gov't to strictly monitor taxes paid by cigarette, liquor firms

inance Secretary Margarito Teves said the government is set to implement soon its plan to strictly monitor the tax payments of cigarette and liquor companies.

“We are finalizing the implementation of the fused-on stamps,” Teves said.

Teves said the fused-on stamps for cigarettes and liquor products would ensure that liquor companies are paying the right amount of excise taxes.

The Bureau of Internal Revenue (BIR) affixes these fused-on stamps on packages containing cigarettes and alcoholic beverages to monitor the production of these products and thereby compute the manufacturer’s excise tax liabilities.

Adopting a new type of fused-on stamps would help protect the agency from fraudulent practices of some companies such as duplication of the stamps.

The affixture must be done in such a manner that will prevent the fused-on stamps from being removed and re-used by washing or any other means and from covering any warning that may be required by law to be printed on cigarette packages.

As part of the plan, BIR officials said the agency would intensify the monitoring of cigarette and liquor firms’ manufacturing facilities. The BIR will increase the number of the so-called “revenue officers on premises” or ROOPs to double check whether cigarettes and liquor products manufacturers are paying the right amount of excise taxes.

The ROOPs will check the manufacturer’s excise tax payments using the stamps.

The agency was supposed to implement the new system last year but it has not been able to bid the contract for the technology-provider.

Fiscal authorities believe that the move would help the BIR improve tax collections.

The BIR is tasked to collect P845 billion this year but expects to generate only P801.268 billion due to tax exemptions. In August, the agency collected P78.9 billion or 0.8 percent lower than the P79.6 billion worth of revenues collected in the same month last year, latest data from the agency showed.