Tax stamps not to delay distilled spirits prod’n – BIR

The Bureau of Internal Revenue (BIR) has assured alcoholic beverage companies that the forthcoming implementation of the use of tax stamps on distilled spirits will not result in manufacturing delays.

BIR Commissioner Kim S. JacintoHenares said the agency is working with distilled spirits manufacturers to come up with an amicable solution on concerns that the stamp tax system would slow down their daily production.

Jacinto-Henares admitted that a number of distilled spirits manufacturers do not have the machinery to start affixing tax stamps on every bottle of alcoholic beverage.

She also disclosed that there is an issue on where to put the tax seal, which causes further delays for the Internal Revenue Stamps Integrated System (IRSIS) for alcohol products.

For these reasons, Jacinto-Henares is now uncertain whether IRSIS would be implemented before the end of the Aquino administration.

“Tax stamps on distilled spirits will be implemented next year, but will it be during my administration? That I don’t know,” Jacinto-Henares told reporters. “Right now, we’re conducting the price survey for distilled spirits in preparation for IRSIS.”

To date, the BIR has yet to release the implementing rules and regulations (IRR) for the tax stamp system covering distilled spirits.

Earlier, the BIR targeted to roll out the tax stamp system, in compliance with Republic Act No. 10351 or the Sin Tax Law, by the second half of 2015, but it was pushed back anew due to manufacturing constraints raised by the stakeholders.

In July last year, the BIR issued its rules detailing the implementation of IRSIS, mandating internal revenue stamps that have “adequate security features for affixture on” each pack and bottle of socalled “sin” products.

BIR’s genuine tax stamps on cigarette and alcohol products will show that all obligations such as excise tax have been paid by the manufacturers, importers or distributors. Since December last year, the BIR implemented IRSIS on cigarette products.

At present, all cigarette makers in the country are required to affix numbered stamps on each pack of cigarettes. Likewise, all imported and locally manufactured cigarettes in the Philippines should have the stamps.

The BIR implemented IRSIS to arrest the alleged “illicit cigarette trade in the local market.”

Data from the BIR showed that sin tax revenues last October accelerated by 80 percent to 14.5 billion. Total take from alcohol products reached 3.7 billion, recording a 12 percent growth, while cigarettes contributed 10.9 billion, up by a robust 126 percent.

In the first 10-months of the year, BIR’s sin tax collections grew 22 percent to 105.5 billion from the same months last year, which is also 20 percent above target for the period.

“This also makes 2015 on track to have the highest sin tax collections in history, beating 2014 and bringing in a total of 114 billion for its full-year haul,” Jacinto-Henares said.