The Bureau of Internal Revenue (BIR), led by Commissioner Romeo Lumagui Jr., in coordination with the National Bureau of Investigation (NBI)-Organized and Transnational Crimes Division, has cracked down on an online-enabled illicit vape operation fronting as a legitimate business, seizing 18,811 vape products and counterfeit tax stamps in Guiguinto, Bulacan.
The enforcement operation, conducted on May 30, was the product of surveillance of online sales activities on Facebook, which provided bases for the issuance of a Mission Order and a search warrant.
“These aren’t just tax violations—they are threats to the health of our children. That’s why we’re going after illicit traders, whether they operate in public markets or hide behind Facebook accounts and residential homes.”
In a post in his official Facebook Page, Lumagui stressed that “we want to send a loud and clear message to those selling illicit vape products: the BIR and NBI will pursue you wherever you hide—online or onsite. The long arms of the law extend into the cyber realm—and we will find you.”
“We will pull out all the stops. Online or onsite, the BIR will do everything it can to stop illicit trade.”
The team raided two establishments: a vape lounge operating as a front for underground vape distribution and a makeshift warehouse located in a residential house. Inside the premises authorities found 4,789 salt nicotine units and 14,022 conventional vape products, along with fake internal revenue excise stamps and counterfeit disposable vapes.
“To put the scale of the haul into perspective—kung conservative po tayo—assuming one disposable vape lasts an average user one week, this means that 18,811 seized units could supply over 4,700 underage users for a month, assuming each one vapes daily,” explained Lumagui.
“So, close to 5,000 kids could be vaping for an entire month from the products we seized in just one operation. These aren’t just tax violations—they are threats to the health of our children. That’s why we’re going after illicit traders, whether they operate in public markets or hide behind Facebook accounts and residential homes.”
Several employees found manning the online and onsite operations during the raid—including online sales agents—are set to be charged criminally, alongside the proprietor, for multiple violations of the National Internal Revenue Code (NIRC). These include: – Section 263: Unlawful Possession of Articles Subject to Excise Tax Without Payment – Section 263-A: Sale of Vapor Products Below Combined Excise and VAT – Section 264: Failure to Issue Required Receipts – Section 265: Offenses Related to Counterfeit Stamps – Section 254: Attempt to Evade or Defeat Tax – Section 255: Failure to Provide Accurate Tax Information.
“We will pull out all the stops. Online or onsite, the BIR will do everything it can to stop illicit trade.”
Charges under Article 172 of the Revised Penal Code (Falsification of Commercial Documents) are also being prepared.
The BIR estimates the total deficiency tax assessment at ₱36.51 million, inclusive of surcharges, interest, and penalties. The basic excise tax liability from the confiscated products alone is pegged at ₱3.49 million.
The BIR noted that the business was employing an illicit layering scheme, issuing a mix of registered and unregistered receipts to mask illegal sales. However, Lumagui revealed that the BIR’s implementation of new strip stamps have made it easier for BIR agents to identify fake and untaxed products.
The BIR has seen a dramatic increase in vape excise tax collections following the 2024 rollout of its digital stamp verification system. In 2023, only 11.2 million milliliters of vape liquids were taxed, generating ₱223.75 million. After the stamp system’s implementation in June 2024, collections surged to ₱942 million from 130 million milliliters in just one year.
