|
By Maricel E. Burgonio Reporter
CONGRESS’ ways and means
committee will push for a single tax rate for alcohol and cigarette
products to generate more revenues for the government, according to
a member of the body.
Rep. Danilo P. Suarez has
proposed the simplification of the excise tax system on sin products
to generate P51 billion in revenues.
For cigarette products, the
legislator has proposed a uniform rate of P14 per pack on all
brands, locally manufactured or imported sold in the domestic market
under House Bill No. 3759.
This intends to promote fair tax
treatment among all brands of cigarettes as it voids the legislative
protection accorded to certain brands.
The government is expected to
generate incremental revenue of P34 billion from a uniform excise
tax rate.
The last major excise tax rate
modification on cigarettes packed by machines was in 2005 under
Republic Act No. 9334, which adjusted upwards the rates and mandated
increases every two years until 2011.
The proposed bill addresses the
inflexibility of the specific tax system by providing yearly
adjustment of the excise tax rates using the consumer price index
(CPI).
For alcohol products, House Bill
No. 3787 seeks to remove the multilevel excise tax classification.
In its place, a single tax rate will be indexed to future inflation
rates.
“This automatic adjustment
mechanism will prevent the value of excise taxes from being eroded
by inflation,” the bill read.
The simplified tax system for
alcohol products is estimated to bring in at least P17.375 billion
in incremental revenues.
At present, the current excise
tax system under R.A. 9334 adjusted the specific tax rate imposed on
each type of alcohol products with parallel increases every two
years until 2011.
“It has failed to automatically
capture the changes in the net retail prices of alcohol products,”
the bill read.
The Bureau of Internal Revenue (BIR)
is targeting to collect P58.436 billion from excise taxes of large
tax payers this year, including manufacturers of cigarettes and
alcohol products.
The BIR, which generates about 70
percent of government revenues, is set to collect P844 billion this
year to support the government’s budget deficit target of P75
billion.
|
