The cigarette paradox
President-elect Digong says he will allot all funds earned by the Philippine Amusement and Gaming Corp. (Pagcor) to health services and education.
Mano Digong doesn’t have to commit Pagcor funds to health services since there is a law that sets aside a portion of a special tax for the health needs of poor people.
(“Mano” is the Visayan word for “kuya” or elder brother).
Mano Digong can channel all Pagcor funds to building more classrooms—following the example of Pagcor Chair and CEO Cristino “Bong” Naguiat—and increasing the pay of public school teachers.
Republic Act No. 10351, otherwise known as the “Sin Tax Law,” provides that excise taxes on cigarettes, liquor and beer be used for the government’s Universal Health Care program.
Through the additional taxes imposed on these products, more government hospitals and clinics will be set up while existing ones will be improved.
When the Sin Tax Law was implemented in 2014, the government collected a whopping P75.51 billion from tobacco products alone.
In 2015, the figure went up to P100.2 billion, an increase of 32.45 percent.
This year, excise taxes on tobacco products are expected to increase by leaps and bounds.
This, despite Mano Digong’s abhorrence of cigars and cigarettes because he wants to protect the health of Filipinos.
What a paradox: Cigarettes and liquor—which cause lung or liver cancer and heart disease—can save the lives of millions of poor patients through the taxes imposed on these sin products.
The government should thus protect local tobacco manufacturers by cracking on smuggled and fake cigarettes.
Mighty Corp., manufacturer of the homegrown Mighty cigarette, for example, has been losing hundreds of millions of pesos because of a China-made imitation brand.
Mighty cigarette, which has eaten up 20 percent of the cigarette smokers’ market, is the most imitated brand because it is more inexpensive than international cigarette brands and tastes, according to smokers, just as “good.”
The government should protect the homegrown brand all the more because the manufacturer pays its employees well and gives them health care benefits, according to a Mighty Corp. official.
The official said the company pays for the hospitalization and medicine even of retired employees and their dependents on a case-by-case basis.
