DOF hopes for passage of sin tax bill this year


    The Department of Finance (DOF) is hoping the bill seeking to increase the excise tax on alcoholic beverages, heated tobacco products and vapor products will be passed into law before the year ends, after it was certified as urgent by President Duterte.

    “We requested the President to certify this bill as urgent so we can get the measure passed. We hope that we can do it before the year ends so that we can implement it in January 1, because if it is passed after January 1, it’s very hard to implement the law mid-way in the year,” Carlos Dominguez, DOF secretary, told reporters at the Senate lounge in Pasay City late Tuesday afternoon.

    “The reception has been very good, from the senators. And we’ve asked them, we know that the budget will take two to two and a half weeks, so that leaves another three weeks for the bill to be passed. That’s what we asked the senators. We said, you know, we really would appreciate it if they can pass it before the end of the year,” he added.

    In a letter addressed to Senate President Vicente Sotto III dated November 12, Duterte called for the immediate enactment of Senate Bill 1074, or the act increasing the excise tax on alcohol, heated tobacco and vapor products.

    “I hereby certify to the necessity of the immediate enactment of Senate Bill 1074… to address the urgent need to generate additional revenue to support the effective implementation of the Universal Health Care Act and to further protect the right to health of the people,” the letter signed by Duterte said.

    Meanwhile, in a statement yesterday, health advocates from the Sin Tax Coalition lauded the move to certify Senate Bill 1074 as an urgent measure.

    “For the past months, the Sin Tax Coalition has been writing to the office of the President asking it to release a certification of urgency for the measure to raise taxes on alcoholic beverages and e-cigarettes,” Anthony Leachon, the coalition’s co-convenor, said.

    “As such, we welcome the news that this important health measure has been certified as urgent. We now call on our senators heed the call of the President, and quickly approve the reform,” he added.

    Senate Bill 1074 was sponsored by Senate Ways and Means committee chairperson Pia Cayetano. Her proposal aims to align the tax rate of heated tobacco products and vape with traditional cigarettes at P45 beginning next year, P50 in 2021, P55 in 2022 and P60 in 2023, with 5 percent annual increases from 2024 onwards.

    For alcoholic beverages, Cayetano seeks to increase the tax on distilled spirits from P23.50 to P90 per proof liter with a 20 percent ad valorem tax beginning next year.
    Fermented liquors and alcopops would be taxed at P45 per liter, up from P25.40.

    A specific tax of P600 would also be imposed on sparkling wines, while a specific tax of P43 would be imposed on still and carbonated wines beginning 2020.

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