Gov’t aims to curb people’s poor diet, raise funds for vital projects
The government will push for the passage of new revenue measures that include additional taxes on sweetened beverages and junk food within the year, Budget Secretary Amenah Pangandaman said Wednesday.
The target would be to have the new tax measures take effect in 2024, so they would have until the end of the year to push for their passage, Pangandaman said.
Aside from generating additional revenues to be used for vital government projects, the higher taxes would result in better health for the people, she said.
In a statement, Finance Secretary Benjamin Diokno said the Department of Finance (DOF) and the Department of Health (DOH) are jointly pursuing a junk food and sweetened beverage tax “as a proactive measure to tackle diabetes, obesity, and non-communicable diseases related to poor diet.”
Under the proposed tax program, the DOF plans to impose a P10 per 100 grams or P10 per 100 milliliters tax on pre-packaged foods lacking nutritional value, including confectioneries, snacks, desserts, and frozen confectioneries, that exceed the DOH’s specified thresholds for fat, salt, and sugar content.
Additionally, the DOF intends to increase the sweetened beverage tax rate under the TRAIN Law to P12 per liter, regardless of the type of sweetener used. This tax rate will be indexed annually by 4 percent, and exemptions will be eliminated to broaden the tax base. These measures aim to strengthen the effectiveness of the sweetened beverage tax by further discouraging the consumption of such beverages.
The higher taxes on junk food and sweetened beverages are expected to generate an additional P76 billion during the first year, the DOH said, and result in a 21 percent reduction in the consumption of junk food.
Pangandaman said for the first year of implementation alone, revenues to be generated from the sugary beverages were projected to be about P40 billion to P50 billion.
“On salty food, [we don’t have the figures] because this is still being studied. But Secretary Benjamin Diokno and the Department of Finance are very positive on the passage of [these] revenue measures,” Pangandaman said.
Earlier, Diokno said the administration wants to impose higher taxes on sugary beverages, motor vehicles and mining to raise much-needed revenues.
The DOF expects the revision of the excise tax on sugary drinks could raise around P53.7 billion, motor vehicles at P15.8 billion, and P12.4 billion from the mining tax.
Diokno said these new tax measures were on top of the remaining tax reform packages that were left behind by the Duterte administration.
Diokno said the incremental revenues from the tax package will fund socio-economic programs initiated by the Marcos administration, such as the Department of Social Welfare and Development’s food stamp program.
This program will provide support to 1 million food-poor households, to alleviate food insecurity and malnutrition, he said.