Senator Win Gatchalian has raised alarm over an estimated P50-billion revenue loss in 2024 due to the growing illicit trade in cigarettes and the misdeclaration of vapor products.

According to data from the Senate Committee on Ways and Means, the illicit cigarette trade alone resulted in a P34.37 billion revenue loss, while misdeclaration of vapor products accounted for P14.84 billion in tax leakages. Additionally, illicit trade in heated tobacco products contributed P840 million in tax losses, based on Bureau of Internal Revenue (BIR) figures.

“This is a serious concern as illicit trade not only causes revenue loss but also worsens health risks linked to smoking and vaping,” said Gatchalian, chair of the committee.

Tax leakage from illicit cigarette trade and misdeclaration of vapor products has increased significantly over the years, from P13.9 billion in 2019 to P48.3 billion in 2023. Projections show the leakage could reach P54.1 billion in 2024 and continue rising, with an expected P65.9 billion by 2028.

Gatchalian emphasized the need for the government to tackle illicit trade, noting that it makes cigarettes and vapes more accessible to price-sensitive groups like teenagers. He added that addressing this issue could boost excise tax collection and help reduce smoking and vaping among the youth.