MANILA, Philippines - The Philippines has complied with a World Trade Organization (WTO) ruling to enact reforms on liquor taxes.
In a statement, the permanent mission of the Philippines to the WTO said that it informed the WTO that the country has fully complied to recommendations and rulings in relation to a case filed by the US and European Union on the country’s liquor taxes through the passage of the sin tax reform law.
The measure which was approved by President Aquino in December last year imposes an ad valorem tax rate of 15 percent of the net retail price per proof and a specific tax of P20 per proof liter for all distilled spirits.
It likewise raised the taxes on alcohol products and cigarettes.
The Philippines’ permanent mission said the law adopts a uniform tax system which applies equally to all distilled spirits and eliminates the tax system found to be discriminatory by the WTO.
“The Philippines noted that the adoption of this new tax system completes the Philippines’ implementation of the findings and recommendations of the Panel and the Appellate Body in this dispute,†the permanent mission said.
Ambassador Esteban Conejos, Jr., the Philippines’ permanent representative to the WTO said President Aquino has time and again stated that the Philippines is open for business, and that the country plays by the rules noting that international trade and investments have been significant catalysts in the country’s economic growth and development achieved in the first two years of the administration.
“Our compliance with this WTO ruling is a living testament of our desire to balance legitimate domestic objectives and the concerns of our foreign investors. It is also a concrete manifestation that President Aquino’s good governance thrust applies not only within our borders, but also in our adherence to our international commitments,†he added.
The Philippines was given a March 2013 deadline to enact reforms on liquor taxes in relation to a case brought by the US and EU against the country to the WTO.