BIR bars sale of vape, cigarettes, heated tobacco below floor price

The Bureau of Internal Revenue (BIR) is prohibiting the sale of vapor products, cigarettes, and heated tobacco products below the floor price, resulting from combined excise and value-added taxes, set by the taxman.

In a statement on Wednesday, the BIR said Internal Revenue Commissioner Romeo Lumagui Jr. issued Revenue Regulation No. 16-2024 (RR No. 16-2024) that updated the floor prices of cigarettes, vapes, and heated tobacco products.

With this, Lumagui reminded e-marketplaces, online sellers, retail sellers, and distributors of tobacco products of the criminal liabilities should they sell such products below the mandated floor price.

Lumagui said the sale of such items below the mandated floor price "is a criminal violation penalized by imprisonment of the seller."

"We are monitoring both online platforms and brick-and-mortar stores. Do not sell below the floor price. Take down all posts and offerings that are below the floor price," he said.

The following table is the updated floor price under RR No. 16-2024:

The BIR said Section 145 (C) of the National Internal Revenue Code (NIRC), as amended, provides that selling of tobacco products at a price lower than the combined excise and value-added taxes imposed under the law shall be prohibited. 

It added that sellers of tobacco products below the mandated floor price "shall be punished with a fine of not less than 10 times the amount of excise plus value-added taxes due but not less than P200,000 nor more than P500,000 and imprisonment of not less than four years but not more than six years."

"Section 263 (A) of the NIRC, as amended, also provides that any person who sells heated tobacco products and vapor products at a price lower than the combined excise and value-added taxes shall be punished with a fine of 10 times the amount of excise tax plus value-added tax but not less than P200,000 and imprisonment of not less than four years but not more than six years," the bureau said. —Ted Cordero/KBK, GMA Integrated News