Latest Stories

Senate OKs lower cigarette tax by 2017


Senate President Juan Ponce Enrile said the Senate version of the sin tax bill would preserve the “old system of classification” of cigarettes to low, middle, and high-class varieties that would be taxed different amounts from 2013 to 2016. INQUIRER FILE PHOTO

Tobacco companies gained a minor victory Tuesday night after senators agreed to lower the unitary tax on cigarettes from P32 to P26 per pack by 2017, the fifth year of implementation of the proposed higher taxes on sin products.

The amendment was made just before the Senate, on a vote of 15-2,  approved on second and third reading the so-called sin tax bill certified as urgent by Malacañang. Sen. Francis Escudero and Sen. Joker Arroyo voted no.

‘Distorted model’

The change was accommodated after Senate President Juan Ponce Enrile and Sen. Ferdinand Marcos Jr., both from the tobacco-producing North, objected to what Enrile called a “distorted and disproportionate model” of tax increases proposed by the Department of Finance from 2013 to 2017.

Enrile said the Senate version of the sin tax bill would preserve the “old system of classification” of cigarettes to low, middle, and high-class varieties that would be taxed different amounts from 2013 to 2016.

Only at the start of 2017 would all classifications impose a unitary tax of P26 per pack as agreed Tuesday night, Enrile said.

While a clear explanation was not given for the reduction in unitary tax, observers noted that it was announced after the Senate suspended discussions on the sin tax bill after Enrile accused the bill’s sponsors of presenting a “distorted and disproportionate model” that would force tobacco companies to pay more taxes than their counterparts in the alcohol industry.

Higher burden

Enrile had complained that based on assumptions made by the DOF, the tobacco industry could end up shouldering as much as 69 percent of the tax burden meant to be shared with alcohol products.

Enrile, waving what looked like a copy of the DOF report, said that while this ratio might be applicable in 2013, the DOF model also showed that the tobacco industry would shoulder a higher burden of 68 percent in 2014, 69 percent in 2015, 67 percent in 2016, and 66 percent in 2017.

He noted that in 2011, the tobacco industry’s share of sin taxes was only 57 percent.

“There is a definite bias (in) this proposal in favor of alcohol against tobacco farmers of the North.  This is against tobacco. Why?” he asked with some irritation.

Marcos supported Enrile’s observation. Marcos earlier  took the floor and noted the distortions in burden sharing.

Still committed

“I think the (senators) who do not believe in this distribution deserve an explanation from the secretary of finance,” Enrile said.

On Monday night, Sen. Franklin Drilon, the acting chairman of the ways and means committee, announced that the senators had agreed during a caucus to a 60-40 burden sharing between the tobacco and alcohol industries on the P40-billion incremental tax to be imposed on sin products.

Enrile said the Senate was still committed to its promise to Malacañang to approve the sin tax bill.

More time

“There might be a misunderstanding. I want to put it on record so we would not be blamed that we are derailing the sin tax. But we (have to) push it according to the agreement,” he said.

Drilon asked that he and his  staff be allowed to “recompute” the burden-sharing ratio starting 2014.

“We wish to have a little more time… We are requesting that we suspend consideration of this measure and take it up again tomorrow,” he said.

Early during Tuesday’s discussion, Sen. Joker Arroyo complained that the bill did not specify the appropriations that would be given to healthcare.

The sin tax bill proponents had said that the additional revenue from the sin taxes would be used to fund healthcare needs, particularly  the repair of government hospitals and  paying the Philippine Health Insurance Corp. (PhilHealth) premiums of poor Filipinos.

Follow Us

Follow us on Facebook Follow on Twitter Follow on Twitter

Recent Stories:

Complete stories on our Digital Edition newsstand for tablets, netbooks and mobile phones; 14-issue free trial. About to step out? Get breaking alerts on your mobile.phone. Text ON INQ BREAKING to 4467, for Globe, Smart and Sun subscribers in the Philippines.

Tags: cigarettes , Government , Legislation , Public Health , Senate , sin tax bill , Smoking

Copyright © 2014, .
To subscribe to the Philippine Daily Inquirer newspaper in the Philippines, call +63 2 896-6000 for Metro Manila and Metro Cebu or email your subscription request here.
Factual errors? Contact the Philippine Daily Inquirer's day desk. Believe this article violates journalistic ethics? Contact the Inquirer's Reader's Advocate. Or write The Readers' Advocate:
c/o Philippine Daily Inquirer Chino Roces Avenue corner Yague and Mascardo Streets, Makati City, Metro Manila, Philippines Or fax nos. +63 2 8974793 to 94
  1. Fr. Suarez says last Mass on Easter before returning donated land to San Miguel
  2. Chinese lawyers say they were tortured by police
  3. Hair salon’s Kim Jong Un poster riles embassy
  4. Siquijor ‘healer’: For every cure, there’s a plant
  5. Why college grads end up in the PNP
  6. Miraculous image makes Gapan City top site for pilgrimage in Central Luzon
  7. I’ll follow my conscience on Estrada, says JV Ejercito
  8. Five men from Cavite found dead in jeep in Batangas
  9. Town, DENR play tug-of-war over crocodile
  10. Suspect in Vhong Navarro mauling tries to leave PH
  1. Suspect in Vhong Navarro mauling tries to leave PH
  2. Massage attendant arrested on rape complaint filed by Japanese tourist
  3. ‘Tell no one’ Makati bettor won P250M lotto
  4. MH370 co-pilot made mid-flight phone call – report
  5. Netizens cry: 6/55 Lotto was rigged
  6. ‘Wife of Jesus’ theory papyrus not fake – Harvard study
  7. North Korea uses flamethrower to execute official
  8. ‘King’ Yabut and I: Driver bares Makati dad ‘abuses’
  9. Gay college instructor arrested for oral sex with student
  10. It was difficult having Japanese blood
  1. KL confirms Malaysian Airlines Flight MH370 ended in Indian Ocean
  2. MRT passengers pass the hat for 6-year-old Ashley
  3. Pork payoffs to newscasters Erwin Tulfo, Del Prado, others bared
  4. UP back on top as ‘average’ student aces bar
  5. Rookie, lady cops lauded for quick response to MOA heist
  6. Model Helena Belmonte wished ‘to slash her wrist and hope to die’
  7. Malaysia averts another air tragedy; pilot lands troubled plane safely
  8. Revilla says he was joking; Lacson stands by his story
  9. Revilla ‘consulted’ Lacson on how he evaded arrest
  10. Police rule out foul play in Helena Belmonte’s death as boyfriend is ‘traumatized’


  • AFP denies hand in disappearance of Tiamzon’s gardener
  • PH gov’t to verify MILF presence in Basilan clash
  • Padaca ‘eager’ to air side on trial over graft, malversation raps
  • DPWH to favor road rehab over preventive maintenance in next 2 years
  • Uruguay’s leader declares $322,883 in wealth
  • Sports

  • Power Pinoys salvage 7th place in Asian men’s volley club championship
  • Knicks prevent Nets from clinching fifth seed
  • Arsenal beats West Ham 3-1 in Premier League
  • Memorial service marks Hillsborough anniversary
  • My ideal weight is 140, declares Pacquiao
  • Lifestyle

  • Celebrate Easter Sunday at Buddha-Bar Manila
  • Moriones feast: A slow, steady transformation
  • Weaving ‘palaspas’ a tradition kept alive in Tayabas City
  • Finalists announced for best translated books
  • Summer treat for your aspiring astronomers
  • Entertainment

  • Deniece Cornejo posts bail—report
  • Miley Cyrus hospitalized, cancels US concert
  • Otaku Summer Jam 2014: Summer’s hottest J-rock/Cosplay event
  • 2NE1 returns to Manila with “All Or Nothing” Tour
  • Gary Valenciano just keeps moving
  • Business

  • I-Remit teams up with Lakhoo for remittances from Oman
  • Megawide nets P1.4 B in 2013
  • Longer TRO sought on rate hike
  • Make a stylish statement with the all-new Yaris
  • Hearing set in Olarte case
  • Technology

  • Smart phone apps and sites perfect for the Holy Week
  • Tech company: Change passwords or suffer ‘Heartbleed’
  • Filling the digital talent gap
  • SSS to shut down website for Holy Week
  • Another reason to quit social media this Holy Week: your safety
  • Opinion

  • We may never know
  • Couple of things
  • Mommy D’s magic
  • Stop bizarre and bloody Good Friday rituals
  • Holy Week taboos
  • Global Nation

  • 2 PCG men ordered arrested over Balintang Channel shooting
  • US Embassy closed on Holy Thursday, Good Friday
  • Relief worker draws inspiration from helping Yolanda victims
  • Philippines says peace pact should hold despite clashes
  • No travel restrictions to Middle East amid MERS-CoV scare
  • Marketplace