DOH supports Drilon’s P40-B sin tax proposal

MANILA, Philippines – Health Secretary Enrique Ona has expressed support for the minimum P40 billion additional sin tax revenues proposed by Senator Franklin Drilon, saying it is the middle ground stakeholders were looking for.

“That’s the floor, meaning businesses will not be affected in terms of workers, but at the same time, you reduce the number of smokers and increase your revenues,” he said in a press conference.

“That’s the minimum,” he added.

The proposal of Drilon, the new chair of the Senate ways and means committee, is much higher than the P15 billion recommended in the report of Senator Ralph Recto, whom he replaced. It is also higher than the P31 billion that the House of Representatives approved.

Drilon said his proposal adopts approved House Bill 5727, but with the added feature that on January 1, 2016, all cigarettes will have a unitary tax rate of P32. HB 5727 seeks to impose rates of up to P28 per cigarette pack.

For fermented liquor, Drilon wants a two-tier system. Beer products with a net retail price below P22, will be taxed P20 per bottle, and those above P22 will be taxed P25.
 
According to Ona, P40 billion would help sustain the universal health care program of the government.

“At present, the national government pays the Philhealth premiums of the poorest of our poor, the 5.2 million families. However, premiums are paid on yearly basis. Every year, there’s a budget for that and you have to defend it, it’s not automatic,” he said.

The health chief said that through the sin tax measure, the allocation for the 5.2 million families will be assured.

“Yes I can probably assure, the allocation will be automatic during the Aquino admin. But what happens after, I can’t say. Number two, we also want to cover another 5.6 million poor families,” he said.

The government eyes to spend 85% of additional sin tax revenues for the universal health care program, and 15% for programs that will aid farmers in shifting to viable alternative crops. – Rappler.com