President Rodrigo Duterte has agreed to certify a bill raising the excise tax on tobacco and alcohol products as urgent, the Palace said Tuesday.
Presidential Spokesman Salvador Panelo said the President approved the Health and Finance departments’ proposal supporting the bill filed by Senator Manny Pacquiao in October 2017.
“There is a recommendation from the DOF that this bill should be certified as urgent because, under the proposal, the tax on tobacco will be raised to P60 per pack while on the part of alcohol it could be P40 per liter. Their recommendation is that the bill should be passed and sign into law,” Panelo said in a Palace press briefing.
The Palace official said Duterte approved the proposal during the 33rd Cabinet meeting Monday evening.
“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 said.
Under the Tax Reform for Acceleration and Inclusion Law, the tobacco excise tax, which is currently at P35, will be raised to P40 by Jan. 1, 2022. Starting Jan. 1, 2024, this will then increase by 4 percent annually.
The DOF also seeks to increase the excise tax rates for alcohol under its proposed Package 2 Plus of the Comprehensive Tax Reform Program.
On the other hand, Pacquiao’s bill seeks to amend Republic Act 10351 or the Sin Tax Reform Act of 2012.
Senate Bill Number 1599 increases the current unitary excise tax rate to P60 per pack from P30 per pack, and the annual excise tax to 9 percent from 4 percent.
In December last year, Finance Secretary Carlos Dominguez III pushed for the increase in the current tobacco excise tax rates to levels that would effectively curb smoking and also help supplement funds for the Universal Health Care program.
Also on Tuesday, the Department of Energy assured the public that it has taken measures to prevent the abuse of the increase in the fuel excise tax provided under the TRAIN law.
“The Department of Energy is mandated to ensure that the pricing of oil products is carried out within the parameters of the TRAIN Law,” Energy Secretary Alfonso G. Cusi said in a statement.
“Over the process of the implementation of the first tranche of the TRAIN Law, we have reached out to our stakeholders, especially the oil companies for their cooperation and we will continue our coordination with them throughout the second tranche,” he added.