As Filipinos welcome the year 2016, anti-smoking advocacy group, New Vois Association of the Philippines (NVAP), is similarly looking forward to the new round of increase in the tax rate for sin products, particularly cigarettes.
According to NVAP President Emer Rojas, their group believes that having another round of tax rate increase will bring the country a step closer to bringing down further the number smokers while also providing the government additional revenues for health programs.
“As in previous years, we expect the new round of sin tax rate hike to bring prices of cigarettes higher and make them more inaccessible for smokers, especially the youth and the poor,” said Rojas.
“By making cigarette products inaccessible, this will result to having fewer individuals being vulnerable to smoking-related illnesses,” he added.
Starting January 1, the taxes on cigarette products will increase to P25 per pack for those priced less than P11.50 per pack, while the higher priced packs will be taxed at P29 per pack.
This is higher than last year’s tax rate of P21 per pack for those less than P11.50 per pack, while those priced at P11.50 or more per pack are taxed at a rate of P28 per pack.
In late last year, the Department of Finance had reported that the sin taxes collected, as of October 2015, has reached P105.5 billion, which is 20 percent above the target revenue.
Based on Republic Act No. 10351 or the Sin Tax Law, 80 percent of the incremental revenues from tobacco and alcohol products will be dedicated to the payment of PhilHealth premium contributions of indigents and senior citizens while the remaining 20 percent is dedicated to health facility enhancement program of the Department of Health (DOH).
Aside from looking forward to higher cigarette prices, Rojas said their group is also preparing for the forthcoming mandatory review of the Sin Tax Law by the Congressional Oversight Committee set later in the year.
“NVAP is researching on the best practices to make the Philippines at par in protecting public health and protecting the interest of farmers,” said Rojas, who is laryngeal cancer survivor.
According to RA 10351, the Congressional Oversight Committee is mandated to review the impact of the tax rates starting the third quarter of 2016.
It was back in December 2012 when President Benigno Aquino III signed the Sin Tax Bill into a law with the goal of making cigarettes and alcohol products less accessible to the public as well as to provide more revenues for the health programs of the government.
Rojas also said they expect the effect of the new round of sin tax rate hike to be further strengthened by the forthcoming implementation of the Graphic Health Warning (GHW) Act.
“The Sin Tax Reform Law and the Graphic Health Warning Act are landmark laws signed by President Aquino. We look forward to seeing these two laws being enforced at the same time and on their potential to significantly bring down the number of Filipinos smoking,” said Rojas.
The GHW Law is already set to take effect one year after publication of the templates with manufacturers not allowed to come out with any cigarette products without graphic health warnings in the packaging.