Republic of the Philippines 
House of Representatives 
Quezon City, Metro Manila
Twentieth Congress 
First Regular Session 
HOUSE BILL NO. 1316 
Introduced by HON. ROMERO FEDERICO “MIRO” QUIMBO 
EXPLANATORY NOTE 
Tobacco use remains one of the most pressing public health threats in the 
Philippines. While past sin tax reforms aimed to curb smoking rates and generate 
much-needed health revenues, recent trends show a reversal—smoking 
prevalence has begun to rise again, and harmful products remain widely 
accessible. Unless urgent action is taken, the public health gains we have fought 
for over the last decade risk being undone. 
Most alarming is the sharp increase in youth exposure to tobacco and 
nicotine. Between 2015 and 2023, adolescent use of e-cigarettes skyrocketed from 
0.8% to 39.9%, driven by the affordability and accessibility of vape and heated 
tobacco products, especially online. The absence of proper controls over these new 
products has created a loophole that has exploited a younger, more vulnerable 
market. 
The increase in the number of smokers in 2023 may be partly attributed to 
illicit trade, but it also reflects the irrational taxation of vape and heated tobacco 
products, which remain significantly cheaper than cigarettes. This price gap 
distorts consumer behavior and undermines the intended deterrent effect of excise 
taxes. While current tax rates are high, enforcement remains weak—tax collections 
July 7, 2025
8:05 am


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fell by 13.7% in 2023 despite rising production and consumption. To correct this, 
the bill mandates a digital tracking and tracing system, registration of 
manufacturing equipment, and accountability for online sellers. 
By modernizing our tax administration and closing enforcement gaps, this 
measure ensures that our excise tax policy remains credible, effective, and aligned 
with its dual purpose: to discourage harmful consumption and to secure vital 
revenues for public services. Without decisive reforms, we risk allowing illicit 
trade, online loopholes, and policy inconsistencies to erode both our fiscal stability 
and the health of future generations.  
This bill is a necessary step toward accountability, equity, and a healthier 
Philippines;  thus, support for this measure is earnestly sought.  
HON. ROMERO FEDERICO “MIRO” QUIMBO 
         Representative 
      Second District, Marikina City  


3 
Republic of the Philippines 
House of Representatives 
Quezon City, Metro Manila 
Twentieth Congress 
First Regular Session 
HOUSE BILL NO. 1316 
Introduced by HON. ROMERO FEDERICO “MIRO” QUIMBO 
AN ACT 
STRENGTHENING THE ADMINISTRATION OF EXCISE TAX ON TOBACCO 
PRODUCTS, CIGARS, CIGARETTES, HEATED TOBACCO PRODUCTS, 
VAPOR PRODUCTS, AND NOVEL TOBACCO PRODUCTS, AMENDING FOR 
THE PURPOSE THE NATIONAL INTERNAL REVENUE CODE OF 1997, AS 
AMENDED
Be it enacted by the Senate and the House of Representatives of the Philippines in the 
Congress assembled: 
SECTION 1. Declaration of Policy. - It is the policy of the State to strengthen tax 
administration and minimize revenue losses resulting from trade of illicit tobacco and 
related products, thereby promoting sustainable economic growth through a whole-of-
government and whole-of-society approach. 
The State recognizes that illicit trade increases accessibility and affordability of 
tobacco and related products, undermines regulation, especially excise tax measures, and 
causes significant losses in government revenues. 
The State acknowledges the need to develop scientific, technical, and institutional 
capacity to plan and implement appropriate measures to mitigate all forms of illicit trade 
of tobacco and related products. 
SEC. 2. Definition of Terms. - As used in this Act: 


 
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a)  Covered Products refer to locally manufactured and imported tobacco 
products, cigars, cigarettes, heated tobacco products, vapor products, and 
novel tobacco products, including hand-rolled cigarettes, smokeless 
tobacco, nicotine pouches, gums, and lozenges; 
b) Digital Platforms refer to information and communication technology-
enabled mechanisms that connect and integrate buyers and sellers in online 
environments where goods and services are requested, developed, and sold, 
and data is generated and exchanged such as e-marketplace, mobile 
application platforms, online delivery platforms, social media platforms, 
and travel platforms; and 
c)  Tracking and tracing refer to the secure marking and up-to-date monitoring 
of movement of products throughout the supply chain through an electronic 
and digitized system. 
 
SEC. 3. Section 8 of the National Internal Revenue Code of 1997, as amended, is 
hereby amended to read as follows: 
“SEC. 8. Duty of the Commissioner to Ensure the Provision and 
Distribution of Forms, Receipts, Certificates, and Appliances, and the 
Acknowledgment of Payment of Taxes. - 
“(A) Provision and Distribution to Proper Officials. – Any law to the 
contrary notwithstanding, it shall be the duty of the Commissioner, among other 
things, to prescribe, provide, and distribute to the proper officials the requisite 
licenses; internal revenue stamps; unique, secure and non-removable identification 
markings (hereafter called unique identification markings), such as codes or stamps, 
be affixed to or form part of all unit packets and packages and any outside packaging 
of TOBACCO PRODUCTS, CIGARS, cigarettes, HEATED TOBACCO 
PRODUCTS, VAPOR PRODUCTS, AND NOVEL TOBACCO PRODUCTS, 
and bottles of distilled spirits; labels and other forms; certificates; bonds; records; 
invoices; books; receipts; instruments; appliances and apparatus used in 
administering the laws falling within the jurisdiction of the Bureau. For this 
purpose, internal revenue stamps, or other markings and labels shall be caused by 
the Commissioner to be printed with adequate security features. 
“Internal revenue stamps, whether of a bar code or fuson design, or other 
markings, shall EITHER HAVE PHYSICAL OR DIGITAL FEATURES, OR 


 
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A COMBINATION THEREOF AND be firmly and conspicuously affixed or 
printed on each pack of TOBACCO PRODUCTS, cigars, cigarettes, HEATED 
TOBACCO PRODUCTS, VAPOR PRODUCTS, AND NOVEL TOBACCO 
PRODUCTS, and bottles of distilled spirits subject to excise tax in the manner and 
form as prescribed by the Commissioner, upon approval of the Secretary of Finance. 
“To further improve tax administration, TOBACCO PRODUCT, CIGAR, 
cigarette, HEATED TOBACCO PRODUCT, VAPOR PRODUCT, NOVEL 
TOBACCO PRODUCT, and alcohol manufacturers shall be required to install 
automated volume-counters of packs and bottles to deter over-removals and 
misdeclaration of removals. 
xxx" 
 
SEC. 4. Section 144 of the National Internal Revenue Code of 1997, as amended, 
is hereby further amended to read as follows: 
“Sec. 144. Tobacco Products, Heated Tobacco Products, and Vapor 
Products. - 
“(B) Heated Tobacco Products. – THERE SHALL BE LEVIED, ASSESSED, 
AND COLLECTED ON HEATED TOBACCO PRODUCTS AN EXCISE TAX AT 
THE RATE OF FIFTY-ONE PESOS AND THIRTY-SIX CENTAVOS (₱51.36) PER 
PACK OF TWENTY (20) UNITS OR PACKAGING COMBINATIONS OF NOT 
MORE THAN TWENTY (20) UNITS. 
 “xxx” 
 “(C) Vapor Products. – THERE SHALL BE LEVIED, ASSESSED, AND 
COLLECTED 
ON 
VAPOR 
PRODUCTS 
CONTAINING 
ANY 
LIQUID 
SUBSTANCE, 
REGARDLESS 
OF 
NICOTINE 
CONTENT, 
INCLUDING 
NICOTINE-FREE LIQUIDS OR ANY SIMILAR PRODUCT, WHETHER 
CLASSIFIED AS NICOTINE SALT OR SALT NICOTINE, OR CONVENTIONAL 
‘FREEBASE’ OR ‘CLASSIC’ NICOTINE, AN EXCISE TAX AT THE RATE OF 
SIXTY-ONE 
PESOS 
AND 
FORTY-TWO 
CENTAVOS 
(₱61.425) 
PER 
MILLILITER OR A FRACTION THEREOF. 
 “Xxx” 
 
SEC. 5. A new section designated as Section 147-A of the National Internal 
Revenue Code of 1997, as amended, is hereby inserted to read as follows: 


 
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“SEC. 147-A. TRACKING AND TRACING SYSTEM. – A TRACKING 
AND TRACING SYSTEM SHALL BE ESTABLISHED FOR THE 
MANUFACTURING, 
IMPORTATION, 
STORAGE, 
REMOVAL, 
DISTRIBUTION, AND SALE OF TOBACCO PRODUCTS, CIGARS, 
CIGARETTES, HEATED TOBACCO PRODUCTS, VAPOR PRODUCTS, 
AND NOVEL TOBACCO PRODUCTS. 
THE SYSTEM SHALL USE SECURE DIGITAL MARKERS 
UTILIZING 
UNIQUE 
IDENTIFIER 
CODES 
PRINTED 
ON 
OR 
INCORPORATED IN THE PRODUCTS WHICH SHALL ALLOW THE 
AUTHORITIES AND THE GENERAL PUBLIC TO VERIFY THE 
PRODUCT'S ORIGIN, MANUFACTURER, PRODUCTION DATE, AND 
OTHER RELEVANT DATA, AS MAY BE REQUIRED BY THE BUREAU 
OF INTERNAL REVENUE. 
THE DEVELOPMENT, OPERATION, AND OVERSIGHT OF THE 
TRACKING AND TRACING SYSTEM SHALL BE MANAGED BY THE 
BUREAU OF INTERNAL REVENUE. THE BUREAU OF INTERNAL 
REVENUE MAY CONSULT THE MANUFACTURERS OF TOBACCO 
PRODUCTS, CIGARS, CIGARETTES, HEATED TOBACCO PRODUCTS, 
VAPOR PRODUCTS, AND NOVEL TOBACCO PRODUCTS TO ENSURE 
THE 
OPERABILITY 
AND 
COMPATIBILITY 
WITH 
CURRENT 
PROCESSES. 
ALL MANUFACTURERS 
AND IMPORTERS OF TOBACCO 
PRODUCTS, CIGARS, CIGARETTES, HEATED TOBACCO PRODUCTS, 
VAPOR PRODUCTS, AND NOVEL TOBACCO PRODUCTS SHALL BE 
REQUIRED TO COMPLY WITH THE TRACKING AND TRACING 
SYSTEM. MANUFACTURERS AND IMPORTERS MUST ENSURE THAT 
ALL PRODUCTS ARE PROPERLY MARKED WITH THE UNIQUE 
IDENTIFIER CODES PRIOR TO REMOVAL TO FACILITATE THE 
TRACKING AND TRACING PROCESS. 
 
SEC. 6. A new section designated as Sec. 164-A of the National Internal Revenue 
Code of 1997, as amended, is hereby inserted to read as follows: 
“SEC. 164-A. MANDATORY REGISTRATION OF EQUIPMENT AND 
MANUFACTURING-RELATED 
ITEMS 
OF 
TOBACCO 
PRODUCTS, 


 
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CIGARS, 
CIGARETTES, 
HEATED 
TOBACCO 
PRODUCTS, 
VAPOR 
PRODUCTS, AND NOVEL TOBACCO PRODUCTS. – ALL EQUIPMENT, 
MACHINERY, AND COMPONENTS USED IN THE MANUFACTURE, 
PACKAGING, 
OR PRINTING 
OF PACKAGING OF TOBACCO 
PRODUCTS, CIGARS, CIGARETTES, HEATED TOBACCO PRODUCTS, 
VAPOR PRODUCTS, AND NOVEL TOBACCO PRODUCTS SHALL BE 
REGISTERED WITH THE BUREAU OF INTERNAL REVENUE WITHIN 
THIRTY (30) DAYS FROM ITS ACQUISITION AND DISPOSAL. 
REGISTRATION SHALL BE UPDATED ANNUALLY. 
THE 
REGISTRATION 
SHALL 
INCLUDE 
PRODUCT 
SPECIFICATIONS, 
ORIGINS, 
AND 
INTENDED 
USE 
OF 
THE 
FOLLOWING: 
1) TOBACCO LEAF PROCESSING MACHINERY; 
2) CIGARETTE MAKING MACHINES; 
3) CIGAR ROLLING EQUIPMENT; 
4) MACHINES 
FOR 
PRODUCING 
HEATED 
TOBACCO 
PRODUCTS AND VAPOR PRODUCTS; 
5) FILTERS AND PAPER USED FOR TOBACCO PRODUCTS, 
CIGARS, CIGARETTES, HEATED TOBACCO PRODUCTS, 
AND NOVEL TOBACCO PRODUCTS MANUFACTURING; 
6) PACKAGING 
AND 
LABELING 
MACHINERY 
FOR 
TOBACCO PRODUCTS, CIGARS, CIGARETTES, HEATED 
TOBACCO PRODUCTS, VAPOR PRODUCTS, AND NOVEL 
TOBACCO PRODUCTS; 
7) PRINTING MACHINERY FOR PACKAGING OF TOBACCO 
PRODUCTS, CIGARS, CIGARETTES, HEATED TOBACCO 
PRODUCTS, VAPOR PRODUCTS, AND NOVEL TOBACCO 
PRODUCTS; AND 
8) ANY OTHER MACHINERY OR COMPONENT PRIMARILY 
DESIGNED FOR MANUFACTURING AND PACKAGING OF 
TOBACCO PRODUCTS, CIGARS, CIGARETTES, HEATED 
TOBACCO PRODUCTS, VAPOR PRODUCTS, AND NOVEL 
TOBACCO PRODUCTS. 
“UPON THE EFFECTIVITY OF THIS ACT, BUSINESS ENTITIES 


 
8 
 
OR INDIVIDUALS IN POSSESSION OF ANY EQUIPMENT FOR THE 
MANUFACTURING 
OF 
TOBACCO 
PRODUCTS, 
CIGARS, 
CIGARETTES, HEATED TOBACCO PRODUCTS, VAPOR PRODUCTS, 
AND NOVEL TOBACCO PRODUCTS, INCLUDING MANUFACTURING-
RELATED ITEMS, ARE GIVEN A TRANSITORY PERIOD OF THIRTY 
(30) DAYS TO COMPLY WITH THE REGISTRATION REQUIREMENTS. 
“MANUFACTURERS SHALL BE JOINTLY LIABLE WITH SUB-
CONTRACTORS OR TOLL MANUFACTURERS IN COMPLYING WITH 
MANDATORY REGISTRATION REQUIREMENTS PROVIDED HEREIN. 
 
SEC. 7. A new section designated as Sec. 263-B of the National Internal Revenue 
code of 1997, is hereby further amended to read as follows: 
“ANY PERSON WHO, IN THE COURSE OF TRADE OR BUSINESS, IS  
ENGAGED IN THE MANUFACTURE, 
IMPORTATION, OR SALE OF 
TOBACCO 
PRODUCTS, 
HEATED 
TOBACCO 
PRODUCTS, 
VAPOR 
PRODUCTS, AND CIGARS AND CIGARETTES, SHALL BE ALLOWED TO 
CLAIM LOSSES DIRECTLY ATTRIBUTABLE TO ILLICIT TRADE AS A 
DEDUCTIBLE EXPENSE UNDER SECTION 34(D) OF THIS CODE. 
THE SECRETARY OF FINANCE, UPON RECOMMENDATION OF THE 
COMMISSIONER OF INTERNAL REVENUE, SHALL ISSUE THE NECESSARY 
REVENUE REGULATIONS TO IMPLEMENT THIS PROVISION, INCLUDING 
THE CRITERIA FOR ELIGIBILITY, THE MANNER OF CLAIMING THE 
DEDUCTIBLE EXPENSE, AND ANY LIMITATIONS THERETO.” 
 
SEC. 8. Monitoring of Illicit Trade of Covered Products. - In order to ascertain 
the magnitude of illicit trade, assess and improve compliance with regulatory and 
enforcement measures, the Philippine Statistics Authority is mandated to conduct surveys 
and studies encompassing producers, traders, retailers, and consumers, and focusing on 
production, consumption, prices, online transactions, and compliance with regulation such 
as tax stamps, packaging guidelines, storage guidelines: Provided, That the results of which 
shall be published and submitted annually to the Inter-Agency Council on Anti-Illicit Trade 
created under Section 10 of this Act. 
 
SEC. 9. Illicit Trade of Covered Products. - The crimes and statutory offenses 


 
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under Republic Act No. 8424, otherwise known as the “National Internal Revenue Code of 
1997, as amended;” Republic Act No. 10863, otherwise known as the “Customs 
Modernization and Tariff Act (CMTA);” Republic Act No. 8293, otherwise known as the 
“Intellectual Property Code of the Philippines;” Republic Act No. 11900, otherwise known 
as “Vaporized Nicotine and Non-Nicotine Products Regulation Act;” and Republic Act No. 
10643, otherwise known as “The Graphic Health Warnings Law” pertaining to covered 
products shall be considered as illicit trade. 
In addition, the crime of illicit trade involving covered products as defined under 
Section 3 of this Act shall include the following acts: 
a)  Manufacturing or importing into the country without the requisite 
registration or import permits from the appropriate regulatory agencies; 
b) Using import permits belonging to person/s, natural or juridical, other than 
those specifically named in the permit; 
c)  Using fake, fictitious, or fraudulent import permits or shipping documents; 
d) Selling, lending, leasing, assigning, consenting or allowing the use of import 
permits of corporations, non-governmental organizations, associations, 
cooperatives, or single proprietorship by other persons; 
e)  Organizing or using dummy corporations, one-person corporations, non-
governmental organizations, associations, cooperatives, or 
single 
proprietorship for the purpose of acquiring import permits; 
f)  Knowingly allowing the use of private ports, government ports, fish ports, 
fish landing sites, resorts, marinas, airports, warehouses, aircrafts, and/or 
vessels to perpetrate the crime of smuggling; 
g) Producing or manufacturing any of the covered products or any part or 
component thereof using equipment, machinery, or components that are not 
registered with the Bureau of Internal Revenue (BIR) pursuant to Section 
164-A of the National Internal Revenue Code of 1997, as amended; 
h) Declaring covered products as for export when they are in fact sold or 
intended for sale in the domestic market to evade taxation; 
i)   Declaring covered products for transshipment when they are sold or 
intended for sale in the domestic market to evade taxation; 
j)   Selling, distributing, causing the transportation, and storing genuine covered 
products diverted from the legitimate supply chain and sold without excise 
tax payment; 


 
10 
 
k) Knowingly transporting and storing of covered products with marks that are 
used without the authorization of the trademark owner or which cannot be 
distinguished in its essential aspect from the original mark: Provided, That 
the transport and storage of the covered products shall not constitute illicit 
trade when the purpose of the transport or storage is for use in judicial, 
quasi-judicial, or administrative proceedings, or when the transport and 
storage is for exhibition and educational purposes with consent of the 
trademark owner; and 
l)   Selling, distributing, causing the transportation, and storing covered 
products that are not included in the list of registered brands of the BIR or 
the Department of Trade and Industry (DTI): Provided, That the transport 
and storage of covered products not included in the list of registered brands 
shall not constitute illicit trade under the following circumstances: 
                              
i)      
when the purpose of the transport or storage 
is for use in judicial, quasi-judicial, or administrative 
proceedings; 
                            
ii)      
when the transport and storage is for 
exhibition and educational purposes with prior notice 
given to the Inter-Agency Council on Anti-Illicit 
Trade; or 
                          
iii)      
when the quantity imported is allowable 
under Republic Act No. 10863, otherwise known as 
the “Customs Modernization and Tariff Act 
(CMTA)”. 
 
SEC. 10. Penalties. – 
a)  Any person found guilty of any of the punishable acts enumerated in Section 
7 shall be punished with imprisonment of not less than twenty (20) years 
and one day but not more than forty (40) years and a fine twice the fair 
market value and the aggregate amount of the taxes, duties, and other 
charges avoided through illicit trade for finished covered products. 
b) Any person found guilty of aiding or abetting in any of the punishable acts 
enumerated in Section 7 shall be punished with imprisonment of not less 
than twelve (12) years and one day but not more than twenty (20) years and 


 
11 
 
a fine equal to the fair market value of the smuggled products and the 
aggregate amount of the taxes, duties, and other charges avoided. 
c)  Any person found guilty of any of the punishable acts enumerated in Section 
7 of this Act who provides information or testifies regarding any insider 
knowledge in the conduct of the illicit trade, against any other involved 
party, and is material in the establishment of the case, shall benefit from a 
mitigating circumstance or a reduced penalty of not less than six (6) years 
and one day but not more than twelve (12) years imprisonment. 
In all cases, the illicit covered products, manufacturing equipment, instruments, 
boats, or vessels used in distributing or transporting or any other mode of transportation 
without distinction shall be confiscated and shall be forfeited in favor of the government. 
The same shall be destroyed or disposed of in government-owned or supervised materials 
recovery, composting, and extrusion facilities which shall be established, maintained, and 
secured by the BIR, the Bureau of Customs (BOC), or the DTI to be located in major 
strategic areas in the country. 
When the offender is a juridical person, criminal liability shall attach to its 
president, chief operating officer, manager or any other corporate officer who consents to 
or knowingly tolerates or ignores the commission of the offense. 
Any person, natural or juridical, found guilty under Section 7 of this Act, shall also 
suffer the penalty of perpetual absolute disqualification to engage in any business involving 
importation. 
If the offender is a public official or employee, the penalty shall be imprisonment 
of not less than forty (40) years and a fine twice the fair market value and the aggregate 
amount of the taxes, duties, and other charges avoided by the illicit trade, for finished 
covered products. In addition, the public official or employee, elected or appointed, will be 
deemed to be absolute and perpetually disqualified in holding any public office. 
If the offender is an alien, the alien shall, in addition to the penalties herein 
prescribed, be deported without further proceedings after serving the penalties herein 
prescribed. 
Prosecution under this Act shall be without prejudice to any liability or violation of 
the provisions of the Revised Penal Code, as amended, or other special laws such as 
Republic Act No. 11900, otherwise known as the “Vaporized Nicotine and Non-Nicotine 
Product Regulation Act, except those acts considered as illicit trade of covered products 
punished under the National Internal Revenue Code of 1997, as amended, and the Customs 


 
12 
 
Modernization and Tariff Act (CMTA), and Republic Act No. 9993, otherwise known as 
the “Philippine Coast Guard Law of 2009.” 
The foregoing notwithstanding, the BIR in accordance with its power to assess and 
collect, is mandated to issue a schedule of fines based on the violations stated in this Act, 
which shall be immediately due and demandable upon the arrest of the offender/s or the 
seizure or confiscation of the covered products. 
 
SEC. 11. Liability of Digital Platforms Selling Illicit Covered Products. - Digital 
platforms shall be responsible for ensuring that no illicit covered products shall be posted 
or sold in their digital platforms by: 
1) Requiring all merchants of covered products to display their proof of 
registration with the DTI or the Securities and Exchange Commission, and 
BIR on their shop page; 
2) Requiring all merchants of covered products to provide permits and license 
information of covered products; and 
3) Contractually obligating the compliance with sale procedures and 
limitations, and other relevant conditions for the sale of covered products. 
The DTI and the BIR shall publish in their respective official websites a list of 
legitimate products that can be sold online regularly. 
The digital platforms shall be solidarily liable if it fails to remove or disable the 
listing of the illicit products on its platform. The BIR may, upon verification, order the 
blocking of specific webpages of sellers not compliant with the provisions of this Act, or 
the entire websites of the digital platforms or online market places found to be in violation 
of Section 9 herein. This shall be implemented by the Department of Information and 
Communications Technology (DICT), through the National Telecommunications 
Commission. 
SEC. 12. Inter-Agency Council on Anti-Illicit Trade. - An inter-agency council on 
anti-illicit trade, hereinafter referred to as the “Council,” shall be established to oversee the 
implementation of this Act. It shall be chaired by the Department of Finance. It shall be 
composed of a representative from each of the following agencies: 
1) Department of Finance; 
2) Department of Justice; 
3) Department of Agriculture; 
4) Department of the Interior and Local Government; 


 
13 
 
5) Department of Transportation; and 
6) Department of Trade and Industry. 
The Council shall convene at least once a month or upon the initiation of the 
Chairperson. The Department of Finance shall provide Secretariat to the Council from its 
existing organizational structure. The Council may invite resource persons to discuss 
important matters as they may deem necessary. 
 
SEC. 13. Powers and Functions of the Council. - The Council shall have the 
following powers and functions: 
a)  Prepare and implement appropriate measures to prevent and suppress illicit 
trade of covered products; 
b) Issue letters of authority directing the BIR, the BOC, and the DTI to enforce 
measures to combat illicit tobacco trade by effecting searches, seizures, and 
arrest, and conducting inspections and securing documents. For this 
purpose, the BIR, the BOC, and the DTI may coordinate with law 
enforcement agencies in their operations; 
c)  Establish a mechanism for the sharing of data or information on illicit trade 
of covered products within and among the members of the coordinating 
body including the identification and determination of the patterns of illicit 
trade in localities, possible routes for illicit trade, networks involved and 
possible hotspot areas, among others; 
d) Ensure the information disclosed are properly recorded and kept and 
complies with existing laws and rules; 
e)  Create effective pathways and guidelines to implement measures against 
illicit trade of covered products; 
f)  Disseminate the policies and guidelines established by the coordinating 
body and ensure its implementation in the national and local levels; 
g) Coordinate and network with similar bodies internationally or globally and 
share lessons and experiences to improve the implementation against illicit 
trade of covered products; 
h) Submit an annual report to the Joint Congressional Oversight Committee on 
Illicit Trade on Excisable Products on its accomplishment and status of 
operations; 
i)   Act on a citizen’s complaint, provided that any person may file a complaint 


 
14 
 
or report violations to any member of the Council; and 
j)   Set other important functions and perform and carry out the same in 
accordance with the rules set by the body. 
 
SEC. 14. Custody and Disposition of Confiscated, Seized and/or Surrendered 
Covered Products. - The apprehending officer or team from either the BIR, BOC or DTI 
shall take charge and have custody of all covered products, as well as manufacturing 
equipment, parts, packaging materials and printing equipment or paraphernalia so 
confiscated, seized and/or surrendered, for proper disposition in the following manner: 
a)  The apprehending officer or team having initial custody and control of the 
covered products shall, immediately after seizure and confiscation, conduct 
the physical inventory and photograph the seized or confiscated covered 
products in the presence of the person/s from whom such items were 
confiscated and/or seized, or his/her representative or counsel, which 
inventory shall be duly signed by the apprehending officer or team leader 
and witnessed and signed by at least two (2) barangay elected or appointed 
officials and be provided a copy thereof: Provided, That the physical 
inventory and photograph shall be conducted at the place where the search 
warrant is served; 
b) The complete list of names of the apprehending officer or team and the copy 
of inventory duly signed and witnessed under paragraph (a) hereof shall be 
submitted to the Council; 
c)  The apprehending officer or team shall be responsible for the safekeeping 
of the seized or confiscated covered products until its final destruction; 
d) All seized or confiscated covered products must be destroyed, except for the 
retention of representative samples for use in judicial, quasi-judicial, or 
administrative proceedings; and 
e)  In every case, the BOC, BIR or DTI shall conduct the destruction of the 
seized or confiscated illicit items in the presence of at least one (1) 
representative from the tobacco or vape manufacturing sector and at least 
one (1) official representative from the Department of Agriculture-National 
Tobacco Administration for tobacco products and materials, or the DTI-Fair 
Trade Enforcement Bureau for vapor products and materials, at least five 
(5) calendar days from receipt of the notice duly acknowledged by the 


 
15 
 
industry and government witnesses. 
 
SEC. 15. Appropriations. – The amount necessary to carry out the provisions of 
this Act shall be included in the annual General Appropriations Act.   
 
SEC. 16. Implementing Rules and Regulations. - Within ninety (90) days from the 
effectivity of this Act, the Department of Finance, through the BIR, shall, in consultation 
with the Department of Trade and Industry, through the Fair Trade Enforcement Bureau, 
the Department of Agriculture, through the National Tobacco Administration, the 
Department of Information and Communications Technology, through the National 
Telecommunications Commission, the Department of Justice, the Department of the 
Interior and Local Government, and the Department of Transportation, through the 
Philippine Coast Guard, promulgate the necessary guidelines for the effective 
implementation of this Act. 
 
SEC. 17. Separability Clause. - If any provision of this Act is declared 
unconstitutional or invalid, other parts or provision hereof not affected thereby shall 
continue to be in full force and effect. 
 
SEC. 18. Repealing Clause. - The National Internal Revenue Code of 1997, as 
amended and all other laws, orders, issuances, circulars, rules and regulation or parts 
thereof, which are inconsistent with the provisions of this Act are hereby repealed or 
modified accordingly. 
 
SEC. 19. Effectivity. - This Act shall take effect fifteen (15) days after its 
publication in the Official Gazette or in a newspaper of general circulation. 
 
Approved,