Revenue Commissioner Romeo D. Lumagui said vape collections can help the bureau hit its excise tax goals this year.
In 2025, the Bureau of Internal Revenue (BIR) has an P343.10 billion excise tax target, 12.76% higher than the recorded collection in 2024.
“That’s what we are expecting because I was more counting on vape. Though cigarette consumption has really decreased, but the efforts continue, especially for vapes,” he told reporters on the sidelines of a briefing on Income Tax Return filing day.
Excise tax collections last year fell short of the P325 billion target by 6.5%, though they were 3.86% higher from 2023.
In 2023, excise taxes amounted to P293 billion, 12.83% short of the goal and lower than the P312 billion collected in 2022.
“We’re hoping that with the increase in compliance of the vape industry, it will improve. But with the consumer preference shift from tobacco to vape…we can capture that… we need that.”
in 2024, tobacco was the only excise tax segment that declined, retreating 0.35%.
Other products such as alcohol (7.29%), petroleum (1,334%), miscellaneous products (8.56%) and mineral (3.55%) posted increases.
Minimal Government Thinkers, Inc. President Bienvenido S. Oplas, Jr. said the BIR won’t be able to arrest the continued decline in revenue from tobacco taxes.
“While the shift by smokers to vapes is one of the reasons, it is not the main reason. The bigger reason is high incidence of illicit trade, smokers shifting from legal and taxed tobacco to illegal and untaxed tobacco,” he told BusinessWorld via Viber Wednesday.
Mr. Oplas also noted that the price disparity between illicit tobacco and legitimate products is widening due to the annual increase in the tobacco tax rate.
“As the price of legal products gets higher each year, the attractiveness of untaxed illegal tobacco rises. And BIR tobacco tax revenue continues to decline,” he said. — Aubrey Rose A. Inosante