REVENUE MEMORANDUM CIRCULAR NO. 128-2020 issued on December 7, 2020 circularizes Joint Memorandum Circular No. 003.2020 of the Department of Finance (DOF), Department of Health (DOH), Department of Budget and Management (DBM), Bureau of Internal Revenue (BIR) and Philippine Health Insurance Corporation (PHIC) relative to the implementing rules and regulations of Heated Tobacco Products and Vapor Products as prescribed in Section 17 of Republic Act (RA) No. 11346 and Section 12 of RA No. 11467.

The sale of any vapor products and/or heated tobacco products to persons below twentyone (21) years old is prohibited and shall be punishable in accordance with Section 144(B) and (C) of the National Internal Revenue Code (NIRC), as amended.

As a requirement in applying for registration, manufacturers, distributors and importers of heated tobacco products and vapor products shall submit to the BIR exact replicas of the packaging and other container or wrapping of the vapor products or heated tobacco products, duly compliant with the Graphic Health Warning Template issued by the DOH and the relevant rules and regulations.

The BIR shall mandate the proper affixture of internal revenue tax stamp and shall ensure that stamp taxes are not affixed on non-compliant packages. The taxpayer shall certify under oath that the products withdrawn are compliant with the Graphic Health Warnings Law and the templates approved and issued by the DOH as well as existing revenue issuances of the BIR.

The requirement to comply with the Graphic Health Warnings under RA No. 10643 shall remain separate and distinct from the requirements imposed under the NIRC, as amended; provided that the BIR shall ensure that packaging approved per the NIRC, as amended, are also compliant with the Graphic Health Warnings Law and its relevant rules and regulations.

For purposes of the full implementation of the Acts, the concerned government agencies shall issue the necessary rules and regulations containing the detailed guidelines, procedures, requirements, penalties as provided for in the Acts, and other information necessary for the effective implementation of the Acts and the Rules.

Apart from the abovementioned mandate and the inherent functions in their charters, the DOF has the following mandates:
a. Issue the necessary revenue regulations and other guidelines for the effective implementation of the Acts and the Rules, upon the recommendation of the BIR;
b. Issue the necessary revenue regulations and other guidelines prescribing the floor price or the minimum price of vapor products and heated tobacco products taking into account the sum of the Excise Tax and Value-Added Tax as provided in RA No. 11467, upon the recommendation of the BIR;
c. In coordination with the BIR and the Bureau of Customs, issue a certification to the DBM, not later than April 15 of every fiscal year, on the total revenue collected from Excise Tax on heated tobacco products and vapor products from the preceding fiscal year allocated for the projects provided in Section 288-A (D) of the Tax Code; and
d. Furnish the DOH and PHIC with the certification issued to DBM for those earmarked for health.