Philippines: Anti-Smoking Advocates Back Probe for Sin Tax Malpractices

Source from:  Cebu City Sun Star (ph) 12/29/2014

THE call for an investigation on the alleged malpractices over the Sin Tax Law's implementation continued to snowball as even anti-smoking advocates have joined the initiative of House Speaker Feliciano Belmonte Jr.

In separate interviews, the Framework Convention on Tobacco Control Alliance Philippines (FCAP), New Vois Association of the Philippines (NVAP) and Philippine College of Physicians (PCP) all agreed that there is a need to ensure that the Republic Act 10351, or the Sin Tax Law, is not being sabotaged.

"There should be a congressional probe of sin tax malpractices and illicit trade (not just of Mighty Corporation) but of all tobacco companies," said FCAP executive director Dr. Maricar Limpin.

She said it is a dangerous precedent to allow violations of existing laws as it invalidates the purpose of the measure and would mean that cigarettes would remain affordable to children and the poor.

"They get to undermine the law and thus prevent us from achieving the two main objectives of sin tax: health and revenues," Limpin said.

Limpin added that not having proper sin tax collection deprives government of true revenues that can help finance the country's healthcare system.

For their part, NVAP and PCP agreed that a congressional inquiry is necessary although they do not agree that it is an immediate necessity.

"An assessment of the sin tax law is necessary. And that is stated in the law, that the sin tax law must be assessed again before 2017 or the final year of implementation," said NVAP president Emer Rojas.

"But a review has just been done and it will be redundant to have another review this soon," PCP president Dr. Tony Leachon said.

Bulacan-based cigarette firm Mighty Corp. has been receiving flak for selling its products at economically unsustainable prices as it is below the cost of production, excise tax and value added tax (VAT).

As a result, Mighty's cigarettes are still priced at P1 per stick and continue to flood the market.

RA 10351 is one of the major health and revenue measures passed by the Aquino administration with the aim of increasing cigarette prices and alcoholic drinks, thereby making them unaffordable for the youth and the poor.

Under the law, 85 percent of sin tax revenues is earmarked for the enrollment of the poorest of the poor to the Philippine Health Insurance Corporation (PhilHealth).

Earlier, the Department of Health and lawmakers, led by House Speaker Belmonte and Senators Antonio Trillanes IV and Juan Edgardo Angara, have called for a congressional inquiry on the Mighty Corporation's alleged fraudulent practices. Enditem