Manila, Philippines (November 11, 2025) – Zamboanga City Vice Mayor Maria Isabelle “Beng” Climaco sounded the alarm on the growing illicit tobacco trade in Mindanao, calling it both a public health and fiscal crisis that robs Filipinos “twice” – first of their health, and again of much-needed revenues for hospitals and social services.
“The illicit tobacco trade directly harms both public health and public revenue,” Climaco said during the launch of the State of the Illicit Tobacco Trade in the Philippines 2025 Report by Action for Economic Reforms and Economics for Health of the Johns Hopkins Bloomberg School of Public Health.
“Cheap, illegal cigarettes make it easier for more people, especially the youth, to smoke. These products often lack health warnings, proper labeling, and quality control, making them more dangerous to consumers.”
The new study, based on randomized sari-sari store audits and empty-pack validation, found that Zamboanga City tops the list of illicit tobacco hotspots, with 79.5 percent of cigarette packs sold below legal tax levels and 47.5 percent coming from unregistered foreign brands, mostly smuggled from Malaysia. Climaco said these findings confirm what she has long witnessed on the ground.
“In my experience as mayor then, and now as vice mayor of Zamboanga City, the illicit tobacco trade thrives mainly because of our porous borders,” she said. “I have personally witnessed early dawn operations and confiscated cigarettes deposited in coastal residences … around 2 a.m. in the morning, when I’m called by the Marines to witness the confiscation of smuggled items.
She explained that smugglers use small wooden boats known as jungkung to slip contraband through remote coves at night, often the same routes used for illegal drugs and fuel.
Over time, she said, “smugglers have become more sophisticated, using smaller boats, hidden warehouses, and counterfeit tax stamps,” requiring coordinated response from multiple agencies.
Climaco emphasized the need for the Bureau of Customs to be present in every raid to officially validate seizures.
“Every time there is an operation, the Bureau of Customs must be there to validate … so that these men, the police and the military, are not deputized,” she said. “We really need the Marines, the Army, in Zamboanga City working with the Philippine National Police.”
She also called for stronger local-national partnerships to tackle enforcement gaps.
“We need a stronger and more coordinated response at both the national and local levels,” she said. “Locally, LGUs must help enforce retail licensing and regulation, closing non-compliance stores that sell unregistered brands. Importantly, a significant portion of the tobacco tax revenue should be reinvested to public health programs, anti-smoking campaigns, cancer prevention and treatment.”
BIR vows stronger enforcement, digital tools to fight smuggling
Bureau of Internal Revenue Commissioner Romeo Lumagui Jr., said enforcement is absolutely essential in addressing the scourge that is the illicit trade.
“The Bureau will not hesitate to use all the resources at its disposal in the campaign against illicit trade,” he pointed out.
He cited successful joint operations in Davao and other southern cities in late 2023, where coordinated raids led to the confiscation of over 717 master cases, roughly 358,500 packs, of illicit cigarettes with estimated tax liabilities exceeding ₱250 million.
“These are inspiring examples of what can be achieved through the collaboration of several government agencies,” he said.
Lumagui also outlined the BIR’s digital-transformation agenda to strengthen its tracking and monitoring of excisable products.
“A key element of our DX program is the drive to upgrade our existing track-and-trace systems,” he said. “Recently, the Internal Revenue Stamps Integrated System (IRSIS) was deployed to manage the ordering, production, and tracking of revenue stamps.”
He added that sustained technology investment and regional collaboration are vital: “Our path forward lies in sustained investment in technology-enabled enforcement … and the most important element of all, the fostering of robust partnerships among governments, businesses, and civil society. The battle against illicit trade cannot be won by one agency alone.”
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Source: AER Media Relations
