The Department of Health (DOH) has thrown its support behind a proposal of the Department of Finance (DOF) to raise the tax rate for cigarette products by 2018, saying that the move would be a big help in putting cigarettes out of reach of most consumers.
Health Secretary Paulyn Ubial said that raising the tax rate was part of the overall strategy of the sin tax law, as she noted that the Philippines was one of the countries still with the lowest priced cigarettes.
“Our cigarettes here, I think, are just over a dollar while in Australia, cigarette packs cost about $50,” Ubial said in an interview with reporters.
The sin tax reform law, which took effect in January 2013, raised taxes on the so-called sin products like tobacco and alcohol to deter the youth and other people from taking up smoking and drinking, and for those already hooked on the habits, to kick them.
The law requires that a portion of the revenue collected from sin taxes go to healthcare and the improvement of medical facilities. It also provides that sin tax rates go up by four percent yearly beginning 2018 after the unitary rates take effect next year.
Antismoking group New Vois Association of the Philippines (NVAP) voiced support for the DOF proposal, saying cigarette price was a powerful factor in cutting smoking numbers in the country, particularly among teens and the poor.
“We believe there is more room for further increase in the tax rates being imposed on these deadly cigarette products,” said NVAP president Emer Rojas.
Last month, the DOF said that among the proposed priority bills it was pushing was an adjustment in the sin tax, further raising the levy, particularly on tobacco products, to generate more revenue to fund poverty-reduction programs.