BIR to launch QR code system to combat illegal vape trade

The Bureau of Internal Revenue (BIR) is developing a digital track-and-trace system using QR codes to help verify the authenticity of vape products and other excisable goods. The system will allow both consumers and regulators to scan the codes using smartphones, making it easier to detect smuggled or unregulated items.

The initiative is part of the BIR’s broader campaign to address the growing problem of illicit vape trade, which not only results in tax losses but also poses health risks.

In a statement released Friday, BIR Commissioner Romeo Lumagui Jr. said the system will support enforcement efforts and assist legitimate businesses trying to comply with tax laws.

“Even businessmen gusto sanang mag-comply, kasi may nahuhuli kaming ganiyan, na sasabihin nilang sir hindi naman namin alam na peke itong mga stamps,” he said, referring to cases where sellers unknowingly deal with counterfeit tax stamps.

Lumagui warned that billions in potential government revenue are being lost due to the widespread sale of illegal vape products. He said that enforcement has become more difficult as sellers use different tactics to hide unregistered items from authorities.

The BIR chief also noted that the growing popularity of vaping, especially among younger users, is complicating efforts to regulate the industry. He said many retailers are still unaware that vape products are subject to excise tax, especially since collection only began in 2022.

“Vape is a relatively new industry… it could help us substantially to meet our target if we address the illegal vape products,” he added.

Aside from strengthening on-the-ground inspections, the BIR is also urging public participation by encouraging reports of illicit trade. Informants may be eligible for incentives under the agency’s reward system.

“Hindi namin ito titigilan. Patuloy ang gagawin naming operations… Kaya sana mag-comply na lang kayo dahil mas maganda mag-comply, makakatulong kayo sa bansa, makakanegosyo kayo nang tahimik,” Lumagui said.