More revenue means more services
In the tobacco-growing highlands of Abra, a congressman has given voice to a quiet national wound: the Philippines lost 141 billion pesos over two years to smuggled and counterfeit tobacco, placing it third among Southeast Asian nations in such losses. The illicit market has grown so vast — nearly nine in ten e-vapes sold are illegal, and a quarter of all cigarettes — that it no longer resembles a shadow economy but a rival one. What is at stake is not merely revenue, but the state's capacity to fulfill its most basic obligations to its people, at a moment when that capacity is already strained.
- A P141 billion hemorrhage over two years has pushed the Philippines to third place in Southeast Asia for illicit tobacco losses, a ranking that signals systemic failure, not isolated crime.
- The numbers are staggering in their proportions: 85.6% of e-vapes and 25.3% of cigarettes on the market are illegal, dwarfing the regional average and suggesting enforcement has lost ground to smugglers.
- Legitimate tobacco farmers in provinces like Abra are being quietly crushed — undercut by untaxed competitors who face little risk, their livelihoods eroding beneath a market they cannot fairly compete in.
- Congressman JB Bernos is calling not for new laws but for something harder to achieve: genuine coordination among the PNP, BIR, Bureau of Customs, and local governments that have long operated in silos.
- Regional ASEAN cooperation and digital track-and-trace customs technology are being proposed as the tools to close the borders that smugglers currently move through with ease.
In Abra, a province where tobacco farming is woven into daily life, Representative JB Bernos has raised an urgent alarm: over the past two years, the Philippines has lost 141 billion pesos to smuggled and counterfeit tobacco products. A study by the EU-ASEAN Business Council and Euromonitor International places the country third in Southeast Asia for such losses, behind only Indonesia and Malaysia — a distinction that speaks to something deeper than porous borders.
The scale defies the image of a marginal black market. Nearly 86 percent of e-vapes sold in the Philippines last year were illegal, and illicit cigarettes claimed a quarter of the domestic market — far above the ASEAN-6 average of 16.1 percent. What has emerged is not an underground economy but a parallel one, large enough to hollow out the legitimate market and drain the treasury of funds meant for schools, hospitals, and infrastructure.
Bernos framed the crisis in terms of national capacity rather than corporate harm. Every peso lost to smuggling, he argued, is a peso the government cannot spend on its citizens — a particularly sharp problem at a time when public resources are already stretched. The human cost lands hardest on farmers and traders in provinces like Abra, who are being undercut by competitors who pay no taxes and face little enforcement risk.
His proposed remedy was deliberate in its modesty: no new laws, no named culprits. Instead, he called for the Philippine National Police, the Bureau of Internal Revenue, the Bureau of Customs, and local government units to coordinate in ways they have evidently failed to do. He also urged ASEAN-level cooperation and the adoption of digital track-and-trace technology to close the gaps smugglers exploit. The question that lingers is whether this measured call will produce real change, or whether the losses will simply continue to accumulate, normalized and unaddressed.
In the northern province of Abra, where tobacco farming has long been a way of life, a congressman is sounding an alarm about money the government will never see. Over the past two years, the Philippines has lost 141 billion pesos to smuggled and counterfeit tobacco products—a staggering sum that ranks the country third in Southeast Asia for such losses, behind only Indonesia and Malaysia. The figure comes from a study by the EU-ASEAN Business Council and Euromonitor International, and it has prompted Rep. JB Bernos to call for a coordinated crackdown on the illicit trade that he says is crippling the government's ability to fund basic services.
The scale of the problem extends beyond simple smuggling. Nearly 86 percent of e-vapes sold in the Philippines last year were illegal products, according to the same report. Illicit cigarettes made up a quarter of the domestic market—a figure that dwarfs the regional average of just over 16 percent. These numbers suggest not a marginal underground economy but a parallel market that has grown to rival the legitimate one. The gap between what the Philippines is losing and what its neighbors lose points to enforcement failures, porous borders, or both.
Bernos, representing Abra's lone congressional district, framed the issue not as a matter of corporate interest but of national capacity. At a moment when the government is stretched thin—his statement references an ongoing crisis without naming it—every peso that slips away through smuggling is a peso that cannot fund schools, hospitals, or infrastructure. He emphasized that the revenue loss directly undermines the state's ability to serve its citizens, a particularly acute problem when resources are already scarce.
The human cost is real, though often invisible in revenue figures. Legitimate tobacco farmers and traders in provinces like Abra are being undercut by competitors who pay no taxes and face minimal enforcement risk. These are people whose livelihoods depend on a legal market that is being hollowed out from below. Bernos did not dwell on their plight, but he named it: farmers and traders are being displaced, he said, and that displacement matters to the nation as a whole.
To reverse the trend, Bernos called for something more ambitious than raids and seizures. He wants the Philippine National Police, the Bureau of Internal Revenue, the Bureau of Customs, and local government units to work in genuine coordination—a call that implicitly acknowledges that these agencies have not been doing so effectively. He also pushed for regional cooperation among ASEAN members, recognizing that smuggling is a cross-border problem that no single country can solve alone. Better customs technology, including digital track-and-trace systems, would help close the gaps that smugglers currently exploit.
The congressman's statement was notably restrained. He did not blame any particular agency or official. He did not propose new laws or penalties. Instead, he argued for enforcement of existing rules and better tools to do the enforcing. His core message was simple: more revenue means more services. It is a proposition that should be obvious, yet the fact that a lawmaker felt compelled to state it suggests how normalized the losses have become. The question now is whether his call for intensified action will translate into actual change, or whether the illicit trade will continue to drain the treasury while the government struggles to meet its obligations to the people.
Citas Notables
Because of the proliferation of illegal tobacco products, the government is being crippled and its ability to serve our people is being affected, especially now that we are in the middle of a crisis.— Rep. JB Bernos
Our fight against illicit tobacco is not only for farmers and legitimate traders who are being displaced, but for the entire nation.— Rep. JB Bernos
La Conversación del Hearth Otra perspectiva de la historia
Why does a congressman from a tobacco-producing province care about this? Isn't he protecting his own farmers' interests?
He is, but not in the way you might think. His farmers are being undercut by smugglers who don't pay taxes and face almost no consequences. A legal market that's being destroyed isn't good for anyone in that province.
The numbers are staggering—141 billion pesos. How does that much product move across borders without being caught?
That's the real question. It suggests either the borders are more porous than they should be, or the enforcement agencies aren't coordinated well enough to stop it. Bernos is essentially saying the system isn't working.
He mentions a crisis. What crisis is he referring to?
The statement doesn't name it explicitly, but the timing suggests he's talking about whatever fiscal or social emergency the Philippines was facing in 2025 and 2026. The point is that losing 141 billion pesos during a crisis is particularly damaging.
What would actually stop this trade? Is it just about catching more smugglers?
Bernos doesn't think so. He's calling for better technology, regional cooperation across ASEAN, and genuine coordination between agencies that currently seem to operate in silos. It's a systems problem, not just an enforcement problem.
Do we know if his call led to anything?
The article doesn't say. It's a statement, a plea for action. Whether the government responded is a separate story.