Philippines: Tax Grab Is Well Meant

The Philippines¡¯ President Rodrigo R. Duterte has approved a proposal to raise excise taxes imposed on alcohol and tobacco products to fund the Government¡¯s Universal Health Care (UHC) program, according to a story by The Philippine News Agency.

¡°The chief executive likewise approved the proposal of the Department of Health and the Department of Finance to increase the excise tax on alcohol and tobacco products,¡± presidential spokesperson Salvador Panelo said in a statement.

¡°This is a key public health measure to reduce deaths and disabilities due to tobacco and alcohol consumption and, at the same time, a revenue measure to fund the universal health care program,¡± he added.

The Agency report said that in December last year, Finance Secretary Carlos Dominguez III had pushed for an increase in the current tobacco excise tax rates to levels that would be effective in curbing smoking and help supplement funds for the UHC program.

In the same month, the House of Representatives approved House Bills 8677 and 8618, which sought to increase the tax on cigarettes and alcoholic drinks respectively.

HB 8677 sought to increase tobacco excise taxes by PHP2.50 each year, from 2019 until 2022. Under the measure, tobacco excise is set to be raised to PHP37.50 per pack in July 2019, to PHP40 in 2020, to PHP42.50 in 2021, and to PHP45.00 in 2022. Tobacco excise would be raised by four percent annually, each July, starting in 2023.

In November last year, the Bicameral Conference Committee approved the consolidated version of the UHC bill which aims to provide all-inclusive health coverage for Filipinos.

Duterte endorsed the UHC bill among his priority measures during his state of the nation address on July 23, 2018.  Enditem