The fiscal and health context that led to the passage of the “sin tax “ bill was presented in an easy-to-understood language to mute opposition to it. And convince those on the wavering aisle to just vote for the bill.

The Philippines has been a laggard in health investment. Laggard is even an understatement. Congress can’t pinpoint even one budgetary cycle that allocated a health budget that meets the UN benchmark on health funding. There were even lean years when the level of health investment did not reach 1 per cent of the country’s GDP.

The under-investment in health, to use a motoring jargon, is mated to a very tragic environment: six of ten killers in the country are poverty-related. The public health delivery system is severely strained on both manpower and resources. Public hospitals are mostly without functioning corridors, with frail beds laden with desperately sick people occupying all virtual available spaces.

Primary and basic health care has been more of a wish list than actual deliverables. And we have yet to cite the tragic statistics on infant mortality and child malnutrition.

It was with great relief that the fiscal and health leaders welcomed the passage of the sin tax bill. But even after its signing by President Aquino, there remains one major area of uncertainty—which netizens concerned with health issues have correctly pointed out in spirited cyber discussions. How do we make sure that the more than P200 billion in additional revenues from the sin tax law in five years is collected, then made part of the revenue mainstream?

How can the revenue people walk the talk on raising the revenue targets required to fund vital health and the other complementary programs such as the planned amelioration program for the tobacco-growing areas? Framed as a tax issue for the 21st century, the question can be summed up as this: What technology and processes should be employed to plug the collection leaks and ensure an almost 100 per cent efficiency in collecting the six taxes? And combat smuggling of sin products in the process?

Forget the old ways and the old paradigms. Cadres of revenue people sifting through records of, say, what volume of tobacco products has been produced, sold and consumed should be out. This old way is prone to errors and susceptible to corruption.

So it has to be a technology and process that cannot be corrupted and subverted. And that particular process and technology has to fall within the guidelines of the World Health Organization (WHO), whose active participation in the overall efforts to help countries improve and enhance their revenue collection on tobacco and other sin products is universally regarded as an intervention of the most strategic and humanitarian kind.

The WHO prescription is actually of two things. Strong tax administration (plus implementation by people of integrity) and a modern, efficient technology to back this up. And right now, the superior technology available is the high-technology track and trace system, popularly called by countries that have adopted it as the strip-stamp technology.

The track-and-trace system, according to the discussions of health activists and health-issue focused netizens, was the chosen technology of the 140 countries, the Philippine included, that recently signed in Seoul a Framework Convention on Tobacco Control, which central agenda is combating illicit trade of tobacco and tobacco-centric tax fraud.

That the adoption of an appropriate technology such as the track and trace system has become the central agenda in the efforts aimed at combating the illegal trade in tobacco and tax fraud is dictated by realities at ground level.

The illegal trade in tobacco is a global problem, according to the WHO, and is a scourge in so many ways. Tobacco products have been a hazard to global health, more so for those within the definition of emerging economies and economically struggling countries. International crime syndicates operating across the globe have been engaged in the illicit trade of tobacco products.

Lax tracking and monitoring of production, sale and consumption results in a double-whammy: it worsens the impact on the health side as more people get killed or get ill, and makes a mockery of the revenue and tax systems of countries as they fail to get their fair share of revenues from tobacco products traded.

Everything boils down to this: big words and purposeful legislation would remain inutile without the application of appropriate and foolproof, corruption-free technologies and processes.

The bright spot is the adoption of the Philippines of the Seoul Protocol. It recognizes many things. One, the illicit trade of tobacco products kills more people and results in a loss of much-needed revenue. Second, there should be sweeping reforms in this area and the passage of the sin tax bill is a step in the right direction. And third, the most appropriate technologies and processes should be on the discussion table and the most superior one should be adopted to help combat the global scourge.

That modern technology undergirds one of the most ambitious and boldest fiscal and health initiatives of the Aquino administration—and may be a failure without it—is really something that modern governance should fully embrace.

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