Tobacco group trashes House sin tax bill

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The Philippine Tobacco Growers Association (PTGA) reiterated its strong objection to the House-approved bill proposing a huge increase in cigarette excise taxes while keeping the two-tier structure even as its president Saturnino Distor disowned press reports maliciously attributing to him statements supporting the measure.

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“We have not changed our position. We strongly oppose House Bill 4144 as this will only bring hardship to the farmers still reeling from the huge tax increase in 2013,” Distor said in a statement.

“I also condemn the unauthorized use of my name and the attribution to me of statements that are contrary to my views. This is the product of malicious minds serving vested interests,” he added.

Distor was quoted in media reports as throwing his support behind HB 4144 in his capacity as the Pangasinan Chapter President of the National Federation of Farmers Association and Cooperatives. (NAFTAC).

He said he has not changed his position, which he publicly stated during the hearing of the House Ways and Means Committee last Dec. 5.

“Our position is stated in Congress and is a matter of public record,” Distor said.

In fact, he said he refused to sign a position paper supporting House Bill 4144 that was offered to him by the National Tobacco Administration (NTA) during the House committee hearing.

“I repeat, the tobacco farmers will bear the brunt of this bill,” Distor said.

Earlier, public health think tank HealthJustice Philippines accused legislators of railroading a bill that would allow cigarettes to remain dirt cheap in the Philippines, contrary to the Philippine health agenda and Duterte’s promise of a Smoke Free Philippines.

May Fernandez-Mendoza, HealthJustice president, said that House Bill 4144 was approved without amendment during second reading on December 5.

It sought a P7 increase in excise taxes to P32 and P36 from the current P25 and P29 with marginal increases of 5 percent per year instead of marginal increases of 4 percent per year based on RA 10351,the current Sin Tax Law which is scheduled to bring taxes to a single rate of P30 in 2017.

Rep. Eugene de Vera of ABS Partylist sponsored the bill which was supported by all those in the super majority.
Another bill filed by Rep. Joey Salceda pushed for P40 with P5 increase per year but this was not passed during the plenary hearing.

“There is an illusion of significant increase in taxes but in reality, this is a ruse to preempt ideal taxes for health that President Duterte, being a strong tobacco control advocate, is capable of calling for,” Mendoza said.

“If this is made in line with the Philippine Health Agenda to reduce harm from tobacco use, taxes on tobacco, should be at least P40, hence significant enough to discourage smoking and bring the Philippines out of the category of those countries having the cheapest cigarettes in the world. It should also call for significant annual increases,” she added.

In 2010, a HealthJustice study projected that, in order to achieve a periodic 10 percent reduction in smoking prevalence or save 200,000 lives annually and reducing 500,000 smokers annually, taxes should have reached a unitary rate of P30 by 2014, to be increased annually based on inflation and income growth.

“However, the deliberation of the Sin Tax bill went through a lot of compromises due to the tobacco industry lobby, and was watered down such that the rate of P30 would take effect only in 2017. To make up for the lost lives, we propose a minimum of P40 excise tax per pack as a starting point in 2017,” Irene Reyes of HealthJustice said.

Mendoza also pointed out that incremental revenues from any tobacco tax increase should go back to the health sector in the form of health promotion, to strengthen communities’ capacity to undertake health initiatives and to have healthy cities.

“Investments must be made to prevent Filipinos from getting sick,” she added.

“The price of cigarettes in Philippines is cheap. If we want to protect the youth, we need to break the P100 per pack price barrier,” said Dexter Galban of One for Nursing Empowerment, a group of nursing students from universities in the Philippines.

Internal tobacco industry documents show that the industry targets the youth as replacement smokers.

According to a survey HealthJustice conducted, the youth will stop smoking if prices of cigarettes are at P5-10 per stick or P100-P200 per pack. Price of a pack of cigarettes averages between P36-65 per pack in the Philippines while it is between P100-450 in countries that are committed to stop smoking, such as Thailand, Singapore, Australia, and USA.

It has also been established that smoking contributes to poverty. A 2008 DOH study shows that the total economic costs for the four smoking-related diseases were estimated at P188 bilion a year. The total collection from tobacco products averages at P120 bilion a year and an average of P 75 billion goes to health.

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