Sin tax bicam OKs P34-B target revenue for 2013

MANILA, Philippines – They did meet halfway, for incremental revenues at least.

The bicameral conference committee on the sin tax reform bill agreed Thursday, December 6, to place target revenues for 2013 at P33.96-B, said Sen Franklin Drilon, head of the Senate contingent. 

“We have settled the most critical portion of the sin tax bill and that is rate of increase of the sin taxes,” Drilon said. 

The House of Representatives’ original version of the bill projected to generate revenues of between P31-B to P33-B. The Senate version calculated revenues of at least P39.5-B. Both figures are lower than the government’s original base revenue of P60-B. 

Thursday’s bicam session ironed out provisions on target revenues, tax rates and burden sharing, Drilon said, and the only contentious provision left to discuss on Monday when the bicam meets again is the rate of earmarking for services such as the government’s universal healthcare program. 

Cigarettes will have a unitary tax rate after 2017, according to Drilon. 

For cigarettes with a net retail price of less than 11.50, tax rate increases are as follows:

2013 – P12

2014 – P17

2015 – P21

2016 – P25

2017 – P30

For cigarettes with a net netail price of 11.50 or more, the tax per pack are as follows:

2013 – P25

2014 – P27

2015 – P28

2016 – P29

2017 – P30

For fermented liquor with a net retail price of less than P50.60, tax rates are as follows:

2013 – P15 

2014 – P17

2015 – P19

2016 – P21

2017 – P23.50

For fermented liquor worth P50.60 or more: 

2013 – P20

2014 – P21

2015 – P22

2016 – P23

2017 – P23.5

For distilled spirits:

2013 – P20 + 15%

2014 – P20 + 15% 

2015 – P20 + 20%

2016 – P21.80 + 20%

2017 – P21.60 + 20%

Delay

Deliberations on burden-sharing between tobacco and alcohol was the most debated part of the hearing, Drilon said. The meeting lasted about 6 hours. 

Camarines Sur Rep Villafuerte said the bicam had already agreed on House’s 70-30 figure but it was met with resistance by some members who were pushing for Senate’s 60-40 rate. 

Session was suspended so that the technical working groups of Senators opposing a 70-30 burden sharing rate could prepare calculations, Sen Fedinand “Bongbong” Marcos Jr said. 

“Historically, kung masusunod ang gusto nila, sa ngayon, walang bumibili sa ganong presyo. Kung walang bumibili sa ganong presyo, wala silang makokolekta,” he said. “I don’t agree at all but they don’t care,” Marcos added. 

Marcos said that if the sin tax bill was truly a health measure, tax rates for alcohol should not be decreased because alcohol consumption also posed health risks. 

On Wednesday, the bicam agreed to remove the sunset provision on the sin tax bill. 

Both Houses of Congress also agreed to impose a 4% tax rate increase every two years. The Senate bill proposes a 5% increase in tax rates every year starting 2014 for alcohol, and 2018 for cigarettes. The House version, on the other hand, proposes an 8% increase every two years from 2015 until only 2025.

The House contingent of the bicam are: Davao City Rep Isidro Ungab, House majority leader Neptali Gonzales II, House minority leader Danilo Suarez, Iloilo Rep Janette Garin, Batanes Rep Henedina Abad, Camarines Sur 4th district Rep Arnulfo Fuentebella, Camarines Sur 3rd district Rep Luis Villafuerte, Negros Oriental RepJocelyn Limkaichong and Ilocos Sur Rep Eric Singson Jr.

Representing the Senate are Senators Panfilo Lacson, Alan Peter Cayetano, Pia Cayetano, Sergio Osmena III, Franklin Drilon, Ferdinand Marcos Jr and Ralph Recto. – Rappler.com