Senate okays tobacco tax hike bill on 3rd reading

MANILA The Senate on Monday approved on third and final reading a measure seeking to increase the excise taxes on tobacco products in a bid to reduce smoking prevalence among Filipinos and to generate additional funding for the government's Universal Health Care program.

With 20 affirmative votes and no negative vote, the upper chamber passed Senate Bill No. 2233 seeking an increase in excise tax for every cigarette pack from PHP45 to PHP60 for the next four years.

A five percent yearly hike shall also be imposed effective Jan. 1, 2024.

The bill's third reading approval came after it was passed on second reading with several amendments on the same day.

Congress dispenses with the three-day rule for measures certified by President Rodrigo Duterte as urgent.

In his certification of urgency, the President said the measure will address the urgent need to further protect the right to health of the people.

Duterte said the bill will also maintain a broader fiscal space to support the effective implementation of the Universal Health Care Act or Republic Act 11223.

The bill proposes the following scheduled increase: PHP45 per pack increase effective Jan. 1, 2020 until Dec. 31, 2021, PHP50 in Jan. 2021, PHP55 per pack in Jan. 2022 and PHP60 per pack effective Jan. 1, 2023.

Among the notable amendments is the taxation on heated tobacco products and vapor products and the earmarking of the revenues to be collected.

Under Republic Act 10963, also known as the Tax Reform for Acceleration and Inclusion (TRAIN) which took effect on Jan. 2018, the existing excise tax rates on cigarettes packed by hand and packed by machine is as follows: PHP37.50 per pack beginning Jan. 1, 2020; PHP40 starting Jan. 1, 2022; and four percent increase every year thereafter.

The Department of Finance said the measure will help fill in the PHP40 billion funding gap for the UHC. (PNA)

Source: Philippines News Agency

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