‘Sin tax’ bill goes to bicam with P8.5-B gap

Alan Peter Cayetano. Fat Reyes/INQUIRER.net

With the “sin tax” bill having cleared the Senate, the sin tax debate now moves to the bicameral conference committee with legislators hoping to bridge the P8.5-billion revenue gap between the Senate and House versions of the bill seeking to raise alcohol and tobacco taxes before the end of the year.

Sen. Ralph Recto, the former chairman of the Senate ways and means committee, said a key focus in the bicam would be whether the Senate would prevail with its target of P40 billion in new revenues in the first year of the sin tax law over the House goal of P31.5 billion. (Both chambers targeted revenues lower than the government’s P60-billion goal.)

In the House version, tax revenues are projected to increase, over a four-year period, by 30 percent to a peak of P40.2 billion. The Senate forecasts a 63 percent in growth over the same four-year period to P64.4 billion.

Equitable sharing

Recto said the Senate had a relatively more equitable sharing of the tax burden between tobacco and alcoholic products—the Senate version pegged the cigarette’s share of the tax increase at 60 percent compared to the 85 percent targeted by the House.

Another point of disagreement, Recto said, is where the revenues raised from the increased sin taxes would go. The   Department of Finance and Department of Health said the additional revenues would go to boosting funds for public health insurance and services.

But Recto pointed out that while the Senate clearly stated what health sectors had been earmarked to get more sin tax money, the House did not make any specific recommendations.

“The rates, revenue assumptions and additional tax burden that the industries could realistically pass on to consumers would be critical talking points in this period,” he said, adding that he remained hopeful that the sin tax law would pass before the end of the year.

Intense debates

Sen. Alan Peter Cayatenao said he expected the debates at the bicameral to remain intense as opponents of the sin tax bill have not given up yet.

“We will really have to decide as a nation what our policy is towards smoking and drinking and using the money for health services. The government at one time promised no new taxes but increase in efficiency. I’m hoping that this extra revenue will really go towards health and the safeguards that will be put in place to prevent the loss of livelihood for the farmers will be fixed,” he said.

Health advocates yesterday said the battle for the sin tax bill was not yet over as there could be a debacle in the bicam.

“The metaphor we use is we are fighting three wars. We won the war in the House. We won the war in the Senate. We have to win the war in the bicam. The bciam is the third chamber,” said Action for Economic Reforms (AER) coordinator Filomeno Sta. Ana.

“Unfortunatety in the bicam, a lot of tricks can happen. Meetings of the bicam are shrouded in secrecy. We don’t know what happens there. Historically, it is in the bicam that politicians insert ‘killer amendments’,” he said.

Health advocates yesterday said Recto and Sen. Bongbong Marcos should be excluded from participating in the bicam for allegedly siding with the tobacco industry.

AER economist Jo-Ann Latuja said Recto “merely copied” the revenue proposals of Philip Morris while Marcos was caught on video talking with Philip Morris lawyers, who supposedly provided him with their revenue estimates.

She said health advocates were planning to file complaints against Recto and Marcos before the Senate ethics committee next week for supposedly failing to uphold the interest of the public.

Malacañang yesterday hailed the Senate approval of the sin tax bill, but admitted it has yet to discuss the fate of the reproductive health (RH) bill with its allies in Congress.

President Aquino certified the sin tax bill as urgent a few days ago. With TJ Burgonio