THE sin tax reform bill ratified by Congress now looms to inflict hardships on more than two million tobacco farmers and workers as a result of its implementation.

Senate President Pro Tempore Jinggoy Estrada, who voted against the bill said that while he is not against raising taxes on sin products, he is also not in favor with unreasonable and inequitable tax increase.

Estrada noted that the 69-31 burden sharing stated in final version of the bill has showed disproportionate imbalance on the treatment of tobacco and alcohol products.

He added that the newly approved sin tax measure seem to indicate that smoking is a greater sin as compared to drinking alcohol in so far as its effects on health and society are concerned.

Sen. Ralph Recto for his part maintained that he is convinced that the government could actually collect the P248 billion projected five-year revenue from higher alcohol and tobacco taxes.

He also warned that such high revenue rates might even put in jeopardy the revenue the government is currently collection from sin products.

Senator Ferdinand Marcos Jr., in explaining his vote against the ratification of the bill, insisted that the measure would essentially destroy the tobacco industry and despite of his warnings and data to justify his claim the executive department dismissed it outright.

He added that the insistence by the finance department of using their clearly flawed numbers showed a completely unrealistic tax collection as a result of this measure.

“And yet, again these arguments were ignored and not examined but we merely continued as if those arguments were not made,” Marcos said

According to him the will only destroy the tobacco industry and large parts of the alcohol industry, without collecting the projected revenues.

Dead by 2017
It will also increase smuggling and in the end, will not reduce the use of tobacco or alcohol.

The local industry manufacturing tobacco and alcohol products might be dead by 2017—the year that the government will impose unitary taxation on tobacco and alcohol products with the passage of the sin tax bill into law.

House Minority Leader Danilo Suarez of Quezon, one of the authors of the sin tax measure, made the pronouncement a day after the House and the Senate ratified the sin tax bill which increases taxes on tobacco and alcohol products—a measure that is expected to generate P35 billion worth of government revenues by 2013 alone.

Moreover, the sin tax bill provides that the excise taxes on tobacco and alcohol products will increase by four percent every year starting 2014 until the taxation scheme becomes unitary by 2017.

“By unitary, it means that the price of imported and local products will be the same. The local industry will be dead, and the imported [products] will live,” Suarez said in a press conference.