BIR closed two cigarette manufacturing company in Subic Freeport

Subic Bay Freeport – In line with its nationwide campaign to conduct tax compliance and verification drive on registration and stock taking of their manufacture products, particularly manufacture of excisable items, the Bureau of Internal Revenue (BIR) Commissioner cancelled today the permit to operate of two cigarette manufacturing firms inside this Freeport zone for violation of unregistered activities.

BIR commissioner Romeo Lumagui Jr. and Revenue District Officer-19 SBFZ chief Atty. Gerlo Cacatian led the team and issued mission orders to companies operated by OneSubic Premier Manufacturing Corporation and Hongsim International Corp, both located at C-3 Warehouse, Subic Gateway Park, Phase II, this Freeport. 

During verification, both companies presented licenses to operate as manufacturer of cigarettes by virtue under Permit to Operate as Manufacturer of Cigarettes No. ELTRD-(T)-0001-10-21-37073 issued by then OIC Assistant Commissioner Manuel V. Mapoy dated October 15, 2021, and Permit to Operate Non-Tobacco Material Warehouse No. ELTRD-T)-007-05-23-45912 issued by OIC Assistant Commissioner Jethro M. Sabariaga dated May 10, 2023.

During inspection of the warehouses, the BIR team discovered that these companies are engaging in unregistered activities such as printing of unregistered foreign cigarette brands, packaging boxes without prior registration with the Large Taxpayer Excise Tax Division of BIR, National office as prescribed by existing BIR rules and regulations.

The business registration of these companies are to engage in the manufacture of cigarettes, however upon inspection, the team witnessed the existence of various printing machineries, paper materials with different cigarette brands, inks, paints and other things needed in the printing of the said cigarette boxes, Lumigue said.

Commissioner Lumigue said, these companies are in violation of the tax revenue code for the non-registration of the cigarette brands and the machineries use to manufacture the cigarettes. 

“Because of these violators, the government is losing hundred billions of pesos in tax revenue intended for social welfare and health care services,” Lumigue said.

The BIR team padlocked the warehouses and conducted inventory stock taking on the machinery for printing boxes, raw materials and other finished products of cigarette boxes. 

The said inventory shall be turned over to the Large Taxes Excise Tax Division which has exclusive jurisdiction on the unfolded unregistered printing activities, including deceptive act of securing a manufacturing license as manufacturer of cigarette without a single manufacturing machine found in the supposed manufacturing warehouse. 

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