Farmers skeptical on lower excise tax take

MANILA, Philippines - Tobacco farmers were surprised to learn that excise tax collections would go down next year even if there would be a scheduled increase beginning Jan. 1, 2011.

They said they cannot believe that only P20.2 billion in tobacco excise taxes would be collected next year as projected by the Department of Finance (DOF).

“That’s pure hogwash,” said the farmers who belong to the Immayos Farmers Association (IFA), the Samara Farmers Associations (SFA), the Itawes Foundation, and the Philippine Association of Tobacco-based Cooperatives (Patco). “How can such collections go down when we know that another round of excise tax adjustment is in the offing next year?”

Records from the Bureau of Internal Revenue (BIR) showed that tobacco excise tax collections have already reached P16.9 billion from January to July this year, compared to only P12.5 billion during the same period last year. This is already a 34.5-percent increase.

The farmers expressed belief that these numbers could further go up as another round of excise tax rate adjustment is scheduled beginning Jan. 1, 2011.

The farmers expressed suspicions that the amount presented by the DOF is an attempt to sway lawmakers into raising the excise tax rate again and this early.

“It appears that the finance department is going against President Aquino’s instructions that there would be no tax hikes this year,” said farmer Asuncion Lopez. “Somebody in the administration could be destabilizing the Aquino government this early.”

The farmers expressed belief that they remain as, what President Aquino had stressed during his inaugural speech, the “boss.” “But it seems that someone is influencing the President to treat us otherwise,” Lopez said.

They said such a treatment from the government may prompt them to hold protest rallies to air their grievance and to remind President Aquino about his vow not to raise taxes.

“We wish to remind PNoy about his campaign promise to the people – to us voters – that there would be no tax adjustments,” the farmers said.