NVAP defends unitary tax system on tobacco products

“Claims that the sin tax was a failure in achieving its economic and health targets and that a unitary tax scheme would only favor big tobacco firms as they will be slapped with the same excise tax as with small manufacturers are baseless,” said Rojas. (Photo: Ricardo Liberato/ Flickr)

MANILA –The New Vois Association of the Philippines (NVAP) on Sunday defended the government’s unitary tax scheme on tobacco products describing it as an essential strategy to promote public health which can help reduce cancer deaths and greatly contribute in generating funds to address the impact of a tobacco epidemic.

In a statement, NVAP president Emer Rojas, a cancer survivor who attested that he was once a chain smoker, also countered the claims of the tobacco industry that the Sin Tax Law failed to achieve its financial and health targets and has lesser impact on tobacco farmers.

“Claims that the sin tax was a failure in achieving its economic and health targets and that a unitary tax scheme would only favor big tobacco firms as they will be slapped with the same excise tax as with small manufacturers are baseless,” said Rojas.

According to the anti-smoking ambassador, the law, which was signed and implemented during the Aquino administration provided imposition a four-tiered tax system on tobacco products which started in 2013.

For the year 2017, it then became unitary wherein all tobacco products-(low and high priced) are now carrying a PHP30 tax per pack.

However, the implementation of this unitary tax scheme is being blocked in Congress with a strong tobacco lobby supporting a two-tiered system through House Bill 4144.

Proponents of the said bill claim that they aim to protect local farmers that produces low-cost brands use locally-grown leaves instead of imported ingredients as in the case of premium brands.

Rojas said that such position is “misleading” adding that billions of pesos have been appropriated from sin tax revenues to assist farmers to shift to alternative crops.

He cited that in the latest results of the Tobacco Atlas covering the Association of Southeast Asian Region it was revealed that 9,474 tobacco farmers in Ilocos Norte, La Union, and the Pangasinan region have shifted to non-tobacco products since 2013 that require less input and labor but yield higher incomes.

The industry said that a two-tier tax system will put more burden on rich smokers since bigger companies are slapped with higher taxes.

Rojas however said that the purpose of the sin tax law was to control tobacco consumption in all levels of users.

Meanwhile many health advocates opposing the two-tiered unitary tax system said that HB 4144 will encourage smokers to just downshift to cheaper brands instead of quitting.

On that aspect, they agreed that disease and death do not discriminate between rich and poor.

They said that the more poor smokers there are the higher the death and disease rates since the poor seldom goes to the doctor for preventive check-ups.

They said that poor usually go to the hospital only when they are really sick.

Rojas said contrary to the tobacco industry’s claims, the sin tax is pro-poor and saves them from premature death and diseases caused by smoking

He added that the sin tax generated from tobacco was close to PHP56 billion in total incremental excise revenue in 2015.

Smoking prevalence decreased from 31 percent in 2008 to 25.4 percent in 2013 while smoking among youth went down from 6.8 percent to 5.5 percent.

This means that there are at least 4 million smokers in the country who have quit the habit today because of the Sin Tax Law.

At least 40,000 deaths have been averted since 2013 due to the implementation of the said law