THE Department of Health is pushing the proposal of the Department of Finance to increase the taxes on cigarettes and tobacco products by 2018.
DoH Secretary Dr. Paulyn Jean B. Rosell-Ubial said the DoF’s plan will further make cigarette products more inaccessible to the public, especially among young people the sin tax or Tobacco Law wants to protect by discouraging them from making smoking a habit or be enticed with it as users.
She added that hiking tax rates on cigarette products is part of the overall strategy in the sin tax law to help fund public health programs, including the expansion of the Philippine Health Insurance System (PhilHealth) to cover millions of indigent Filipinos.
“We are still one of the countries with the lowest cigarette prices in Southeast Asia. The cost of our cigarettes here, I think, is just over a dollar [per pack]… In Australia, its 50 dollars…,” Dr. Ubial said.
She noted that the projected cigarette tax increase can be carried out even if the number of users will go down (because of tax reform), as the overall collection will still go up because the habitual users will still buy cigarettes at high costs.
It was back in December 2012 when then President Benigno S. Aquino III signed the Sin Tax Reform Bill or Republic Act No. 10351 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.
The law is considered to be one of the legacies of the former President who was a smoker himself but had shown the political will in addressing one of the public health concerns in the country.
As provided by the said law, sin tax rates are already set to go up by four percent yearly starting 2018 after the unitary rates take effect by next year (2017).
Recently, the DoF said it will push for the adjustment of the tax rates for sin products, specifically tobacco products, by 2018.
The DoF said this is because the four-percent annual increment is deemed “too low” and should, thus, be increased.
Meanwhile, in a statement, the New Vois Association of the Philippines (NVAP) also expressed support to the DoF proposal.
“We believe that there is more room for further increase in the rates of taxes being imposed on these deadly cigarette products, especially after the R.A. 10351 has proven to be effective in being a health policy of the government,” said NVAP president Emer Rojas.
“Cigarette price is a powerful lever in lowering smoking rates, particularly among teens and the poor,” said Rojas, an engineer.
He said increasing the tax rates on cigarette products could not come at a better time than in 2018 with the implementation of unitary rates already set for next year.
“With a unitary tax rate already in place by 2017, the government may already work for the uniform increase in the sin tax charged to cigarette products. This will definitely discourage more people from smoking,” Rojas said.