The government hopes to discourage smoking and drinking by raising the tax rates on cigarettes and alcoholic drinks. But it requires parallel measures to curb smuggling of cigarettes and alcoholic drinks to keep these so-called sin products less accessible and less affordable. Raising taxes alone won’t do the trick.

A review of Republic Acts (RAs) 7171 and 8240 that grant subsidies to tobacco farmers may also be in order to discourage them from planting tobacco and to promote a shift to other high-value crops that have less adverse effects on human health.

RA 7171 provides 15 percent of collections from excise taxes on tobacco products to provinces that produce Virginia tobacco. Most of these provinces are in the Ilocos region; RA 8240 grants additional 15 percent of the additional revenue collections from the excise tax on tobacco products to provinces producing burley and native tobacco.

The subsidies are supposed to be intended to improve the livelihood of tobacco farmers. Let’s hope that programs and projects funded with the subsidies are not meant to increase production of more tobacco, but to help the farmers find alternative income sources and make them less dependent on tobacco farming.

The new law ensures that these subsidies are taken care of before allocating for the universal health care program, which is designed to benefit poor families.

Perhaps it was a wise move that the President vetoed the provision in the Congress-approved bill that requires manufacturers and sellers of tobacco products to buy at least 15 percent of their raw materials from local sources. That was considered as a ‘protectionist’ provision that goes against the National Treatment on Internal Taxation and Regulation of the 1994 General Agreement on Tariffs and Trade.

In the first year of implementation of the higher excise taxes on the sin products, the Department of Finance has estimated to increase collections by P34 billion, up to P64 billion by 2017, with 65 to 70 percent coming from tobacco taxes.

That is a lot of money indeed. It is crucial in meeting the government’s revenue collection target of P2.005 trillion to fund its 2013 spending program.

But taking into account the social and health costs of smoking, the projected revenues would pale in comparison.

Ten years ago, epidemiologist Dr. Antonio Dans of the University of the Philippines estimated the health and economic costs of smoking to the population at P46 billion a year. In those times, the government collected an average of P19 billion in excise taxes of tobacco products.

From 2003 to 2006, estimates by the World Health Organization pegged the health and economic cost of smoking at P148.5 billion, while government collection averaged P24 billion. The cost was six times more than the excise tax collection.

Last year, spending on tobacco-related diseases was placed at P177 billion.

According to the Department of Health, there are 17.3 million tobacco consumers in the country, the highest in Southeast Asia.

A briefer in the official government gazette said Filipinos consume 1, 073 cigarette sticks a year, while smokers in the region puff less than a thousand sticks annually. The high consumption rate among Filipinos has been attributed to the very low prices of cigarette in the country.

Increasing tobacco taxes by 10 percent can reduce the number of smokers by two million by 2016, according to the Health department. This significant decrease in the number of smokers is said to translate to a corresponding decline in smoking-related deaths.

Studies have attributed several preventable diseases to smoking. These are among the leading causes of deaths in the country, particularly those connected to the pulmonary system such as lung cancer, chronic obstructive pulmonary disease or COPD, coronary heart disease and stroke.

That is why I have always been against smoking. Not that I hate smokers; just some of them. I hate smokers who have no respect for non-smokers. I hate those who puff tobacco anywhere and everywhere, disregarding the no-smoking regulations.

With the New Year coming, I wish this latest tax law that the government and Congress painstakingly worked hard for will indeed discourage smoking. The enactment of the law showed that Congress has the courage to resist strong lobby from manufacturers. That alone gives us a ray of hope.

I also wish that government will be as steadfast in enforcing environmental laws to reduce air pollution, which is also a major cause of respiratory and pulmonary diseases.

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