Philippines Raises Tobacco Excise Taxes for 2025

The Philippines has been steadily increasing excise taxes on tobacco products in recent years, with the latest adjustments taking effect on March 22, 2025. These tax hikes are part of the government’s ongoing efforts to discourage smoking and raise revenue for the country’s universal healthcare program.

Under Republic Act (RA) No. 11346, also known as the Tobacco Tax Law of 2018, excise taxes on cigarettes and other tobacco products have been gradually increasing since 2020. The law also introduced taxation and regulation on heated tobacco products (HTPs) and vapor products, commonly referred to as e-cigarettes or vapes.

For the year 2025, the specific tax rate for HTPs has been set at P35.84 per pack of 20 units. This rate is a result of the annual 5% increase that began in 2024, following the initial yearly increases from 2021 to 2023.

Unmanufactured tobacco, which includes raw tobacco leaves and other tobacco materials, is now subject to an excise tax of P2.81 per kilogram. This increase is part of the government’s efforts to discourage the production and sale of loose tobacco products, which are often cheaper and more accessible than manufactured cigarettes.

• Read more: Philippines BIR to Align Taxes on Tobacco and Vape Products

The higher excise taxes on tobacco products are expected to not only generate additional revenue for the government but also to reduce smoking prevalence in the country. By making these products more expensive, the government hopes to discourage young people from starting to smoke and encourage current smokers to quit.

However, some critics argue that the tax hikes may lead to an increase in the illicit trade of tobacco products, as smokers seek out cheaper alternatives. To combat this, the government has been working to strengthen its enforcement efforts and crack down on the sale of untaxed and counterfeit tobacco products.

As the Philippines continues to implement its tobacco control policies, including higher excise taxes, it remains to be seen how effective these measures will be in reducing smoking rates and improving public health outcomes in the long run.

• News source: BOC implements higher excise tax hike on alcohol, tobacco

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Matthew Ma

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With over a decade of experience in the e-cigarette industry, Matthew Ma is a seasoned expert in both the manufacturing and usage aspects of vaping products. His extensive background has provided him with a deep understanding of the intricacies and evolving dynamics of e-cigarettes.

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