End game on sin tax up

By Macon Ramos-Araneta

Senate vote for the bill seen today.

Senator Franklin Drilon, the acting chairman of the Senate ways and means committee, said he expected senators to vote for the passage of the sin tax bill when sessions resume today.

“I am confident that our colleagues have seen and realized the importance of the reform measure to a great majority both as a health measure and as a finance bill,” said Drilon Sunday.

Drilon said he expects to finish the debates on the individuals amendments proposed by those who oppose the bill before it is sent to the Senate floor for a vote.

Drilon said his bill, which faced a thorough scrutiny during the five extended session days, will face individual amendments on Monday before its ratification.

Drilon’s committee report targets an additional P40 billion revenues from increased taxes on tobacco and alcohol products.

This is P20 billion lower than the target proposed by the Finance Department.

Earlier, Senator Ralph Recto had resigned as committee chairman after he drew flak from the Palace for proposing a bill with a much lower P15 billion collection goal.

Local tobacco companies and farmers have warned that “exorbitant” taxes would kill the industry, a view shared by Recto, Senate President Juan Ponce Enrile, and Senator Ferdinand Marcos Jr., who comes from the tobacco-producing north.

Recto called the P40-billion target “unrealistic.”

On Thursday night, President Benigno Aquino III certified the bill as urgent, allowing it to be approved on second and third reading on Monday without the usual three-day interval.

As a rule, a bill must undergo three readings on three separate days except when the President certifies a bill as urgent to meet a public calamity or a national emergency.

“We are in the final stretch. We are only one step [from] the passage of this bill,” said Drilon. Marcos last week vowed to make amendments to the bill when sessions resume today.

Enrile and Recto are also expected to propose their own amendments. Over the weekend, former Health secretaries asked legislators to set aside P1 billion from the extra revenue generated from sin taxes for health promotion.

Alfredo Bengzon, Alberto Romualdez Jr., Jaime Galvez-Tan, Juan Flavier, Francisco Duque III, and Esperanza Cabral said in a statement this would help Filipinos make healthier choices and adopt healthier lifestyles.

Tan, who served as Health secretary under President Fidel V. Ramos, noted that the health budget should not just focus only on treating the sick because most of the population is healthy.

“Health promotion ensures that all Filipinos can benefit from… funding [of] key programs such as tobacco control, alcohol control, road safety and sports,” he said. “The right to health is for everyone and health promotion ensures that all Filipinos have access to it.”

A study by the Health Department showed that nine out of every 10 Filipinos have at least one risk factor that could lead to non communicable diseases.

These risk factors include tobacco use, hypertension, and obesity and could lead to life-threatening conditions that are costly to treat.

Health promotion could ease the burden of treating the ill by reducing the number of people getting sick and seeking medical attention, the former Health secretaries said.

The Philippine Medical Association, the umbrella organization of all medical societies in the country with a total membership of 70,000, called for the passage of the sin tax bill before it is too late.

“We value the health of our youth and we are confident that the passage of this bill would not just help smokers quit but also ensure that our children would not be able to afford the habit of smoking and drinking too much alcoholic beverages,” said the PMA in a statement issued Sunday.

The morbidity and mortality due to diseases related to smoking and drinking are tremendous, the group said.

“We can benefit from a healthier and cleaner air if there were [fewer] Filipinos smoking. Sadly, the poor are the ones mostly affected by smoking-related diseases,” the PMA said.

As the Senate committee of ways and means prepared to vote today, members of the Northern Alliance in the House of Representatives warned those seeking re-election that there would be a price to pay in next year’s election if they voted for higher excise taxes.

La Union Rep. Victor Ortega, the alliance president, made the statement, saying it is but natural for tobacco farmers to declare who they will support during the coming polls.

“Of course they will support those who have been considerate of their plight in making a decision on the sin tax bill,” Ortega said.

“It is but natural also for these tobacco farmers to say they will reject senatorial bets who will support a sin tax bill version that will adversely affect the farmers’ plight. On the other hand, you can expect these farmers to support candidates who sympathized with them in the fight against hefty excise tax rates,” Ortega added.

Ortega said the voting power of tobacco farmers should not be underestimated, noting that the eight major tobacco-producing provinces form a vote-rich region with at least 4.5 million voters during the last senatorial election.

In the Ilocos Region, which comprises the provinces of Ilocos Norte, Ilocos Sur, Pangasinan and La Union, there are about 300,000 tobacco farmers, Ortega said.

“This could easily translate to one million votes if voting members of their families are included,” he said.

The eight major tobacco-producing provinces were Pangasinan, La Union, Ilocos Sur, Ilocos Norte, Abra, Cagayan, Isabela and Mindoro. Other provinces that produce tobacco are Mountain Province, Ifugao, Nueva Vizcaya, Quirino, Tarlac, Nueva Ecija, Capiz, Iloilo, Leyte, Cebu, Misamis Oriental, Bukidnon, Davao, Zamboanga del Sur, Maguindanao, Cotabato and Saranggani.

Nueva Vizcaya Rep. Carlos Padilla, one of the 21 congressmen whovoted against the House version of the bill, said the legislation is certainly an election issue in tobacco-producing provinces. The House-approved version of the sin tax bill provides an estimated P31.28 billion in new revenue – mostly from tobacco products.

“It is inevitable that these affected sectors during the May 2013 elections will manifest their unfavorable sentiment against re-electionist senators who will support a tax bill that imposes drastic and immediate increases in the rates,” Padilla added.

A big workers group also warned lawmakers of railroading the passage of the sin tax bill, saying it could lead to mass layoffs and the loss of jobs.

The Bukluran ng Manggagawa said lawmakers should prove their independence, not only from Malacanang, but also from the International Monetary Fund, which supports more new taxes, including a levy on telecommunication services.