Groups oppose suspension of sin taxes
Advocacy groups are opposing a bill seeking to suspend levying of excise on tobacco, vapes and other related products next year, arguing that making these products accessible to the public, the moratorium on the so-called sin taxes would also reduce funding for essential health programs of the government.
“It is alarming that the proponents filed the bill without providing solid evidence that higher tobacco taxes cause an increase in illicit trade. They are sabotaging a proven measure to reduce tobacco consumption,” said Ma. Victoria Raquiza, co-convener of Social Watch Philippines (SWP).
“This clearly shows that these lawmakers care more about the tobacco industry than the health of the Filipino people. It raises questions about our legislators’ development priorities. They must be held accountable,” she added.
On Jan. 14, lawmakers filed House Bill No. 11279, which proposes suspending the 5 percent annual tax increase on tobacco, heated tobacco, vapor products, cigars and cigarettes for the entire 2026, and replacing it with a 6 percent adjustment every two years starting in 2027.
The bill’s proponents argued that high taxes aggravate the illicit tobacco trade by pushing consumers toward cheaper and smuggled alternatives, resulting in revenue losses.
Citing estimates from nonprofit research firm Action for Economic Reforms, Raquiza said HB 11279 would result in P27.5 billion in forgone revenue from 2026 to 2030 if implemented.
It would also result in a 4.8 percent increase in the total number of cigarettes smoked, and a 2.4 percent increase in the smoking intensity (or packs per capita) versus the current figures.
“Following this projection, the bill could lead to 400,000 additional smokers by 2030 compared to the status quo. By introducing HB 11279, the bill’s authors are risking public health to promote the tobacco industry’s interest,” added Raquiza.
According to SWP, higher taxes are key to reducing consumption by making tobacco products less affordable. This discourages new users and encourages current users to quit.
The 2021 Global Adult Tobacco Survey found that almost seven out of 10 Filipino tobacco users considered the high price of cigarettes a major reason for quitting.
It also showed that nine out of 10 current smokers of manufactured cigarettes reduced their daily consumption due to the sin tax.
According to SWP, the moratorium on sin taxes for tobacco products would mean smaller funding for universal health care coverage, particularly those lodged under the Department of Health and Philippine Health Insurance Corp..
In order to address illicit trade, the group called on Congress to reject HB11279, and instead strengthen in-country enforcement and promote international cooperation.
“Rather than sabotage a proven public health measure, we urge our leaders to uphold our commitment to the Framework Convention on Tobacco Control, which the Philippines has signed,” Raquiza said.
