THREE Liberal Party (LP) lawmakers led by Rep. Leila de Lima (PL, Mamamayang Liberal) have filed a bill seeking to increase the tax on sweetened beverages (SB) to reduce the prevalence of obesity and related non-communicable diseases.
De Lima, along with Reps. Cielo Krisel Lagman of Albay and Arlene Bag-ao of Dinagat Islands, on Tuesday afternoon filed HB No. 5003, which seeks to amend Republic Act No. 10963 or the Tax Reform Acceleration and Inclusion (TRAIN) Law to improve the current tax policy on SB by updating the tax rate, expanding the tax scope to previously exempted products.
“In 2017, a tax policy imposing a two-tiered specific tax on sweetened beverages was passed into law under Republic Act No. 10963, otherwise known as the Tax Reform Acceleration and Inclusion (TRAIN) Law. It was implemented in January 2018, resulting in a one-time increase in the prices of beverages due to the levied tax rate of P6.00 on drinks with caloric and non-caloric sweeteners, and P12.00 on those containing high fructose corn syrup (HFCS),” the bill said.
The bill seeks to impose a tax increase from P12 to P40 per liter of volume capacity on sweetened beverages using purely high fructose corn syrup or in combination with any caloric or non-caloric sweeteners.
It also seeks to increase from P6 to P20 per liter of volume capacity on sweetened beverages using purely caloric sweeteners, and purely non-caloric sweeteners, or a mix of caloric and non-caloric sweeteners.
The bill also seeks to impose a P6 tax on all flavored milk, fermented milk, and flavored non-dairy milk beverages and on all sweetened coffee products.
The bill also aims to enhance key features of the law, such as the inclusion of annual indexation and a more impact-driven earmarking of revenues to benefit the health and nutrition of Filipinos, since a significant portion of the revenues from the SB tax “shall be allocated to programs that help address malnutrition, including access to clean water, sanitation and hygiene.”
The LP lawmakers said that no less than the World Health Organization (WHO) strongly recommends measures similar to their bill, recommending that the rate of excise tax to be imposed must raise retail prices by 20 percent to decrease the consumption of sweetened beverages.
“The World Health Organization has taken the issue of the negative effects on health of sugar-sweetened beverages so seriously that it has developed a stand-alone tax manual that serves as a practical guide to help legislators craft policies towards the promotion and fulfillment of the right to health. Indeed, there is no sugarcoating it: sugar poses real risks to human lives,” Bag-ao said.
De Lima, a former senator and justice secretary, said the ill effects of sweetened beverages “impact not only individuals and families, they also pose a significant economic burden on the country.”
She noted that in 2021 alone, the total economic cost to society of diabetes and cardiovascular diseases attributable to diets high in sweetened beverages “amounted to a staggering total of P11.18 billion.”
Lagman said their group’s proposal “is a win-win reform. If enacted into law, it will improve our people’s health and quality of life, thereby reducing healthcare costs and productive losses even as it generates new revenues for nutrition and health programs at a time when fiscal space is constricting,” she said.
The LP lawmakers urged their colleagues to support the measure “for the health of every Filipino family, for the future of every Filipino child, for our country that, as Filipinos, we all have the responsibility to steer forward.”
