Ilocos Norte tobacco excise tax funds controversy

On 2 March 2017, House Majority Leader Rodolfo Fariñas, along with Pampanga representatives Aurelio Gonzales Jr. and Juan Pablo Bondoc, filed House Resolution 882, which requested the House Committee on Good Government to "conduct an inquiry" about the misuse of PHP 66.45 million from Ilocos Norte's share of excise tax funds to obtain more than 110 units of motor vehicles. The resolution cited that the "highly irregular purchase" violated 2 republic acts—RA No. 7171, "An Act to Promote the Development of the Farmer in the Virginia Tobacco Producing Provinces," [10] and RA No. 9184, "Government Procurement Reform Act [11]--and 1 presidential decree: PD No. 1445, Government Auditing Code of the Philippines.[12][1] The investigation began on 2 May 2017, but later experienced delays due to missing documents and failure of Imee Marcos and other Ilocos local officials to attend the first two hearings.[13]

Fariñas filed the house resolution after discovering three checks indicating the following transactions through cash advances:

1. Check dated 1 December 2011 as PhP18,600,000 cash advance for 40 units of Mini cab
2. Check dated 25 May 2012 as PhP15,300,000 cash advance for second-hand 5 units of buses
3. Check dated 12 September 2012 as PhP32,550,000 cash advance for 70 units of Foton Mini truck

The vehicles were said to be for distribution to the different baranggays and municipalities.[1] In a letter she wrote to the House committee, Marcos justified the purchase as a response to the multiple requests of farmers asking for vehicles,[14] although Fariñas had pointed out that RA 7171 does not include purchasing vehicles as a means to utilize the excise tax. He also pointed out that a baranggay captain from Laoag City received vehicles, despite the fact that there are no tobacco farms in that area.[13] Other baranggay captains have also complained that the vehicles were not duly registered under the Land Transportation Office (LTO), or filed as government property, so costs for oil and gas could not be reimbursed by the baranggay budget.[15]

Aside from the aforementioned checks, three other signed ordinances indicated that large shares of Ilocos Norte's tobacco excise tax were "set aside" for Marcos' pet project known as "Programang Ikauunlad ng Mamamayan Ekonomiya at Ekolohiya, or "P Imee." [13] In 2011, Php57,500,000 was allocated for P Imee, and separate amounts of Php78,600,000 and PhP 78,000,000 in 2013 alone, totalling in a massive PhP213,000,000.[13]

On 29 May 2017, six local officials were detained by the House committee, after they refused to answer questions during the hearing, and invoked their right against self-incrimination. The officials were Pedro Agcaoili, Eden Batulayan, Josephine Calajete, Encarnacion Gaor, Genedine Jambaro, and Evangeline Tabulog.[3] They claimed not remembering any of the aforementioned transactions.[16] They were released on 24 July 2018, after confessing that they indeed had access to tobacco excise tax funds used to pay 70 mini trucks.[17] They also acknowledged that it was their signatures written on pertinent documents, a fact that they had previously denied.[18] Marcos also admitted that the said mini trucks were bought from a direct contractor, and was not up for public bidding, as was the protocol when government property is procured.[17]

Upon continued investigation and hearings, the House committee discovered more anomalies, one of which was that all the purchased vehicles "were overpriced by PhP21,450,000." [4][19] The direct contractor who sold the 40 units of mini cab was identified as Mark Chua, who is also currently Marcos' boyfriend. Records showed that although Chua initially bought each unit for Php270,000, he sold the mini cabs to the government for Php485,000, the overprice amounting to Php7,800000 overall.[4][19] The committee also verified the complaints from baranggay captains that the vehicles did not have registrations from the LTO.

Committee Report No. 638 therefore concluded and recommended that charges be filed against Marcos, Chua, and several local officials.[4] As of July 2018, another "fact-finding investigation" initiated by the Office of the Ombudsman is underway. If they find enough cause, the Ombudsman will then open a formal investigation.[5]

Imee Marcos is the daughter of late dictator and former President of the Philippines Ferdinand E. Marcos and former First Lady Imelda R. Marcos. After the death of her father and the family's return from exile, Marcos returned to Philippine politics, serving as Congresswoman to the 2nd district of Ilocos Norte from 1998 to 2007. She then ran and was elected Ilocos Norte governor in 2010. She is currently serving her third and final gubernatorial term, which will end in 2019.

• Imee Marcos
• List of political scandals in the Philippines