Cigarette prices to increase more with passage of universal health care bill

MANILA, Philippines – Expect prices of cigarettes to increase more as higher tariffs will be imposed on tobacco products to fund the Universal Health Care (UHC) bill  which aims to provide all Filipinos with access to adequate health services.

Speaking at press briefing in Malacañang Palace, Department of Health Secretary Francisco Duque III said the price of tobacco products will most likely increase further as these new round of sin taxes will be on top of the hikes due to the first tax reform package or the TRAIN law.

Duque said the increased sin taxes will be a major source of funding for the universal health care law.

How much will the increase be? It depends on what lawmakers decide, but Duque referred to proposals authored by Senators Manny Pacquiao and JV Ejercito.

"Oo naman, depende 'yan sa desisyon ng Kongreso. Kasi ngayon may panukala si Senator Manny Pacquiao na P60 ang karagdagang buwis na ipapataw bawat pakete ng sigarilyo samantala ang panukala naman ni Senator JV Ejercito ay P90,” Duque said on Wednesday, August 15. 

(It will [increase], depending on the decision of Congress. Right now, there is a proposal from Senator Manny Pacquio to place a tax of P60 per pack of cigarettes, while Senator JV Ejercito’s proposal is P90.)

Duque said if Ejercito’s proposal were followed, it would result in proceeds of about P45 billion.

“A big part of this will go to PhilHealth… funds will also come from other taxes collected by the government but a big part will come from incremental tax increases,” Duque said in Filipino.

He added the increase in taxes on tobacco products will also help the DOH to achieve its goal of lowering the number of Filipinos smoking from 21.47% of the population down to 14%.

In providing health coverage for all Filipinos, a key feature of the proposed bill makes membership in PhilHealth automatic as either contributory or non-contributory. Employees are considered contributory members because their PhilHealth contributions are deducted from their salary. On the other hand, those who cannot pay, such as indigents, are still covered by PhilHealth services.

Duque said 85% of proceeds from sin taxes go to health care. Of this, 80% of the money collected will go to Philhealth while 20% will be used for the DOH’s Health Facilities Enhancement Program and its Medical Assistance to Indigent Patients program.

These programs seek to improve patient’s access to barangay and rural health units  and subsidize medicines. (READ: What Duterte government’s P100M subsidies can do for PGH patients)

Swift passage: President Rodrigo Duterte earlier urged Congress to pass the UHC bill during his 3rd State of the Nation Address. He certified as urgent the health care law during a Cabinet meeting last July.

While the House has passed its version of the bill, the counterpart measure in the Senate – Senate Bill No. 1458 – is still pending in the committee level. – Rappler.com

Sofia Tomacruz

Sofia Tomacruz covers foreign affairs, the overseas Filipino workers, and elections. She also writes stories on the treatment of women and children. Follow her on Twitter @sofiatomacruz. Email her at sofia.tomacruz@rappler.com.

image