House panel approves bill increasing alcohol taxes

MANILA, Philippines – The House ways and means committee on Wednesday, November 21, approved a bill seeking to increase excise taxes on alcohol products.

House Bill (HB) 8618, which has been endorsed to the plenary for approval, seeks to “significantly curb alcohol consumption and raise funds" for the Universal Health Care program. (WHO to PH: 'Real investment' in universal health care 'needs to happen')

The bill seeks to amend the National Internal Revenue Code of 1997 and Republic Act 10351, which restructured the excise tax on alcohol and tobacco in 2012.

Under HB 8618, alcohol taxes for distilled spirits like gin, rum, and vodka will increase as follows:

For sparkling wines, the bill proposes an ad valorem tax of 15% of the net retail price (excluding excise and value-added taxes) per liter and a specific tax of P650 per liter. The specific tax will increase by 7% in 2020 onwards.

For still and carbonated wines with 14% alcohol or less, it will be P40 per liter, to be increased by 7% starting 2020. For still and carbonated wines with more than 14% alcohol, taxes will also increase by 7% on top of P80 per liter from 2020 onwards.

The tax on fermented liquors will be P28 per liter in 2019, P32 per liter in 2020, P34 per liter in 2021, and P36 per liter in 2022. After this, a 7% increase will be observed 2023 onwards.

The bill also seeks to increase the adjustment of alcohol taxes due to inflation from 4% to 7%.

The Department of Health earlier said it would need about P257 billion for the first year of implementation of the UHC law. Faced with an estimated funding gap of  P164 billion, the DOH has been pushing for an increase in tobacco taxes which would generate funds of about P45 billion to P47 billion.– Rappler.com

Sofia Tomacruz

Sofia Tomacruz covers foreign affairs and is the lead reporter on the coronavirus pandemic. She also writes stories on the treatment of women and children. Follow her on Twitter via @sofiatomacruz. Email her at sofia.tomacruz@rappler.com.

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