N. Luzon lawmakers divided on sin tax reforms

After Ilocos Sur Governor Chavit Singson expressed his support to the Malacanang-backed sin tax reforms, other lawmakers in his region in turn are worried

MANILA, Philippines – After Ilocos Sur Governor Luis “Chavit” Singson expressed his support to the Malacanang-backed sin tax reforms, other lawmakers in his region in turn are worried, citing possible adverse impact of the new legislation to their constituents.

In a statement on Thursday, March 15, La Union Rep. Victor Ortega said members of the Northern Luzon Alliance (NLA) are concerned that “implementing excessive increase in tax rates may result in the demise of the country’s tobacco industry.

“While members of the NLA recognize the need to increase excise tax rates on tobacco products, they believe that any adjustments made must be moderate and within reasonable range,” he added.   

The NLA — known as the powerful block in the Lower House that has largely influenced the current structure of excise taxes on sin products — are reacting to Singson’s presence during a press briefing of the tax and health department chiefs on March 5.

UNLIKELY PARTNERS. Health Secretary Enrique Ona, Governor Luis "Chavit" Singson and tax chief Kim Jacinto-Henares announce their support for House Bill 5727 in a March 5 press briefing. Photo by Katherine Visconti.

Finance Secretary Cesar Purisima, who has been eyeing the additional P60 billion-a-year additional tax revenues from the sin tax reforms, has also been touting Singson’s “support” to the Malacanang-backed House Bill 5727 on the sin tax reforms.

Also knows as the Abaya Bill, HB 5727, which is authored by Palace ally Cavite Rep.  Joseph Abaya, is currently pending at the Ways and Means Committee at the House of Representatives.

While bulk of the additional revenues it would generate would be earmarked for universal health care costs, lawmakers who are members of NLA are concerned that the resulting lower cigarette consumption would hurt tobacco farmers,  most of whom are based in the Ilocos or Northern Luzon region.  

The fate of the tobacco farmers has been cited prominently in the debates on the sin tax reforms.

“In light of reports that Gov. Chavit Singson has thrown his support behind the proposed Abaya Bill, members of the Northern Luzon Alliance (NLA) lawmakers last night met with the Governor, to clarify his stand and discuss their collective position regarding the proposed bill,” Ortega wrote.

Ortega eventually said that the NLA and Singson are one in saying that “while there is a need to increase taxes, any changes in the current excise tax system should reflect a sound balance between the government’s need for increased revenues and the need to protect local industries and other stakeholders.

Singson is currently trying to be on the good side of the Aquino administration.

At the previous press conference, Singson said he only supports the sin tax reforms but not the graphic warnings on cigarette packs.

The Aquino government is pushing both efforts to reduce cigarette smoking in the Philippines. – Rappler.com