Alarm raised on sin tax changes

DAGUPAN CITY, Philippines—A legislator has raised the alarm on plans to amend the sin tax law, saying any move to raise taxes would only benefit tobacco monopolies.

Kabataan Rep. Terry Ridon made the statement in a media interview on the sidelines of a ceremony in La Union province, where a foundation and the National Tobacco Authority distributed scholarship grants to children of tobacco farmers.

Ridon said no resolutions had been filed so far to amend Republic Act No. 10351, or  the sin tax law, which increases tariff provisions on cigarettes and alcoholic beverages.

“Further raising the tax would prejudice smaller domestic tobacco companies that cannot absorb the added tax burden. Only foreign tobacco monopolies will be able to absorb [the new taxes],” Ridon told the Inquirer in a phone interview on Thursday.

“Further amendments to the sin tax law will impose severe economic burden on tobacco farmers and their children. It means less money that can be spent on them,” he said.

The law says cigarettes packed by hand shall be levied an excise tax of P12 per pack starting in 2013.

It says the excise tax should rise to P15 per pack this year and would rise again to P18 per pack in 2015, P21 per pack in 2016 and P30 per pack in 2017.

“The public should be wary of the propaganda being thrown against sin tax reform in the country,” Ridon said in an earlier statement.

Ridon said much of the criticism against the sin tax law was part of corporate rivalry in the tobacco industry.

“The law leveled the playing field and allowed Filipino companies to compete against giant, foreign-dominated monopolies,” Ridon said in the statement.

Sin tax collection in 2013 hit P103.3 billion, with tobacco products accounting for P70.4 billion of the total take. Yolanda Sotelo, Inquirer Northern Luzon, with a report from Rafael Antonio, Inquirer Research