THE Philippine Economic Zone Authority (PEZA) is investigating two locators found to have been manufacturing cigarettes without registration with the Bureau of Internal Revenue (BIR).

The BIR last week said it would withdraw the tax-stamp exemption of cigarettes manufactured for export, after a legislator said these products could enter the market as tax-free smuggled goods.

Revenue Regulations (RR) No. 9-2015 allows cigarette exporters to omit the required tax stamp proving payment of excise taxes.

PEZA said that GB-BEM Cigarette Co. Inc. and GB Global Exprez Inc. facilities had been raided by the BIR for operating without registration and permits required for cigarette manufacturing. The companies are being investigated by the BIR and the House Committee on Ways and Means.

The investment promotion agency said it would apply its own penalties after its separate investigation.

Legislators at a committee hearing last week said PEZA had been lax in allowing locators to manufacture cigarettes without BIR permits.

PEZA said that the agency is in talks with the BIR and Finance department to ensure ecozone locators’ compliance with government requirements. — Jenina P. Ibañez