Philippines: Sin Tax Law Amendments Opposed

Source from:  Manila Bulletin  07/01/2014

Lawmakers yesterday assailed moves by critics of the country's Sin Tax Law to seek amendments just a year after it was passed, calling the moves "bad business practice."

"The public should be wary of the propaganda being thrown against sin tax reforms in the country. Critics of the law should immediately stop its mudslinging and just accept the fact that the law has proven to be a big success, not only for the small Filipino enterprises but also for the government as well," Kabataan Party-list Rep. Terry L. Ridon said.

He said much of the criticisms being leveled against Republic Act 10351 or the Sin Tax Reform Law are part of corporate rivalry in the tobacco industry.

"RA 10351 leveled the playing field and allowed Filipino companies to compete against giant foreign-dominated monopolies. Those affected by the law should not use anti-sin tax reform propaganda just to hit their corporate enemies. That is bad business practice and anti-Filipino," Ridon added.

Deputy Speaker Sergio F. Apostol, of Leyte's 2nd District, had earlier called for immediate approval of a comprehensive antitrust bill seeking a ban against monopolies and stop foreign companies from imposing their economic interests in the country.

"This ugly price war (in the tobacco industry) is an example of why the immediate approval of the antitrust bill is to be considered with utmost urgency," Apostol said.

For her part, Bureau of Internal Revenue Commissioner Kim Henares said in an interview with media in June 2013 that RA 10351 "had leveled the playing field."

Sin tax collections in 2013 hit P103.3 billion, with tobacco products accounting for P70.4 billion of the total take.

Ridon said official government data shows that the health and revenue objectives of the law are being met.

"What is not being met are the objectives of monopolies which is to prolong their stranglehold in the country's multibillion-peso tobacco industry. And they appear to be hell-bent in regaining the market share they lost as a result of the sin tax reform law by claiming the law is a failure," Ridon said.

"We should not allow this to happen. The interests of the nation and the people cannot take a back seat to the vested interests of a foreign monopoly. We should be on guard and prevent this from even taking root," he added.

In a related development, Rep. Elpidio Barzaga, of the 4th district of Cavite, said the absence of an antitrust law enables big businesses to manipulate prices and control supplies.

"They have strong influence and lobbying power to pursue their economic interests," he said.

Barzaga issued the statement as he rallied behind the country's small business enterprises to create a comprehensive antitrust law to protect them from foreign monopolists out to control local industries.

There are seven bills that have already been moved to the Committee on Rules for revision and consolidation in preparation for the plenary debate.

Once ratified, the bill will provide a level business atmosphere across all industries. "The proposed antitrust law favors the Filipino people and the national economic interest against foreign mega businesses," Rep. Barzaga said.

"It also aims to protect the economic interest of local Filipino producers, such as tobacco farmers and local tobacco companies, who mutually rely on each other to make clean and honest profit," he added. Enditem