HOUSE Ways and Means Chair Joey Sarte Salceda (Albay, 2nd district), urged the Bureau of Internal Revenue (BIR) to intensify its enforcement measures against the shuttered electronic cigarette brand “Flava,” in light of the recent closure order issued by the Department of Trade and Industry (DTI).
“The BIR should have done so much more, and Flava should have been closed down much earlier. BIR’s inaction on certain red flags delayed this long overdue business closure.”
In particular, Salceda says, “the BIR should make sure that it does not issue any more manufacturing licenses to companies with no clearly demonstrated capacity to manufacture vape.”
Salceda pointed out that Flava had been issued a license to manufacture its goods by the BIR even when the addresses provided by the company were residential.
“It should have been a red flag, and indeed it was. It was what the BOC used as basis for raiding suspected warehouses.”
Salceda also said that “the continued operation of the company for several months without assigning a revenue-officer-on-premise (ROOP) was a lapse on the part of the BIR.”
“All manufacturers of excisable products are assigned an ROOP to inspect the removals of goods from their manufacturing facilities. This ensures that taxes were paid prior to being released for sale. In the case of Flava, the BIR representative during the hearings could not name who was the ROOP assigned.”
“If an ROOP were assigned, then that officer is at least suspect for malfeasance,” Salceda added.
“It also should have been a red flag that despite the proliferation of Flava products, it did not qualify as a Large Taxpayer based on its submissions with the BIR.”
“But, the BIR can still remedy these issues. First, no manufacturing license should be issued without thorough, documented inspection.”
“Second, all accredited manufacturers should be assigned an ROOP, no ifs, no buts.”
“Third, for sensitive products like e-cigarettes, inspections should be more thorough and more regular.”
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