UK firm urged to bare cigarette report funder
BUREAU of Internal Revenue (BIR) Commissioner Kim Henares on Tuesday urged UK-based think tank Oxford Economics to make public who funded the report which it recently released that showed an alleged rise in illicit cigarette trade in the country largely as a result of the Sin Tax Reform Law.
“I believe that for the sake of transparency, Oxford Economics should disclose who paid for their study and let the public determine who they will believe in,” Henares said in a text message.
In a report released last week, Oxford Economics claimed that while the higher so-called “sin” taxes imposed on cigarettes in the Philippines had been steadily decreasing consumption, the increased rates also bolstered the sales of cheaper products that allegedly evade tax payments.
In a press briefing in Hong Kong last week, Oxford Economics senior Asian economist Oliver Salmon said they had kept “full academic control” of the report despite funding from a major global tobacco player.
“We are very open… We are very up-front about the conditions under which we have been employed to conduct this research; we’ve never tried to hide the fact about who funded this report. But we’ve always maintained full academic control. At the end of the day, the [report has] our name on it, no one else is. It’s our reputation, our credibility with which these figures go out into the public,” Salmon said.
The Oxford Economics’ Asia-16 Illicit Tobacco Indicator 2014 report showed that illicit cigarette consumption rose in 2014 to 19.9 billion sticks or 19.4 percent of the total, from 19.1 billion sticks or 18.1 percent of total in 2013.
The report claimed that this resulted in P22.5 billion in foregone revenues last year.
Henares, however, said that the Oxford Economics study was biased.
She also branded as inaccurate the claim that the government lost last year more than P22 billion in revenues due to the consumption of untaxed cigarettes.
Henares cited a World Bank study which showed that only five percent, not 19 percent as claimed by Oxford Economics, of the total cigarette consumption yearly were sourced from the illicit cigarette trade.
