Palace welcomes initial success of Sin Tax Law

MANILA, Philippines - Malacañang is elated by the initial success of the Sin Tax Reform Law’s implementation and said the information dissemination for health and wellness among the people would continue to achieve better results.

Presidential Communications Operations Office Secretary Herminio Coloma Jr. said over dzRB that it took a long time before the measure was passed because of the powerful lobby against increasing the taxes on tobacco and alcohol.

But he said President Aquino exercised political will to have the law passed, which was coupled with a vigorous campaign to discourage people from smoking and drinking alcohol for their health and well-being.

“That is why it became successful and continued to earn recognition from various countries,” Coloma said.

Smoking among the very poor and the young decreased in the first quarter of 2014, a study conducted by the Social Weather Stations (SWS) revealed.

The number of smokers from economic class E or the poorest went down from 38 percent in December 2012 to 25 percent in March this year.

Yesterday, the Philippines joined the World Health Organization (WHO) in observing “World No Tobacco Day” seeking to promote the reduction of tobacco consumption as a vital health and wellness measure.

“This observance heightens public awareness on the health risks associated with tobacco use and advocates the adoption of effective policies to reduce tobacco consumption,” Coloma said.

In a recently published document, Coloma said the WHO commended the Philippines as one of the countries in the world that successfully pushed for reforms in the government’s health agenda by enacting a law restructuring taxes on tobacco and alcohol.

This is Republic Act No. 10351, or the Sin Tax Reform Law, which Aquino signed on Dec. 20, 2012.

On May 22, the Southeast Asia Tobacco Control Alliance (SEATCA), the tobacco control coalition in the Association of Southeast Asian Nations region, gave recognition to Aquino, as well as the Department of Health (DOH) and Department of Finance (DOF), for the country’s landmark achievement in passing and thereafter implementing the Sin Tax Reform Law.

In a statement, SEATCA recognized Aquino’s efforts in “inspiring leadership and unwavering political will to push forward a revolutionary Sin Tax Reform Law, thereby putting public health before profits and ensuring tobacco control measures.”

Coloma said other health programs were also launched to complement measures such as the Sin Tax Reform Law.

According to the SWS, young Filipinos are smoking less, with 18 percent of smokers coming from the 18- to 24-year-old age group. In December 2012, the number stood at 35 percent.

Despite the reduction among population sub-groups, however, the overall smoking prevalence in the Philippines went down from 29 percent in 2012 to 26 percent in 2014.

The nationwide survey of 1,200 respondents was conducted from March 27 to 30.

Promising results

Acting Health Secretary Nemesio Gako said the SWS survey showed that the initial findings are very promising that the government’s objective of regulating cigarette smoking can be attained.

“Although in the total picture there is no significant reduction, the impacts are on the youth and the poor who are really our target,” he said.

However, the survey showed that 45 percent of smokers switched to cheaper brands of cigarettes when the prices increased.

On the average, a smoker consumes 10 sticks daily.

The survey further showed that 67 percent, or seven out of 10 smokers, buy cigarettes by the stick. 

The median price of cigarettes that smokers spend per stick is P3, way below the P10 threshold for them to quit smoking based on an SWS survey in 2012.

Finance Undersecretary Jeremias Paul said the tax increase has not been passed on fully to the smokers.

“The cigarette companies absorb a part of the increase... so what we have noticed is that the premium brands, the more expensive brands are essentially subsidizing the low-priced brands,” he said.

Paul said the reduction in tobacco consumption could have been bigger had “we gone unitary immediately” in cigarette pricing.  

“This was not allowed by Congress because with unitary, we don’t have the downsizing in price cuts,” he said.

“Since we are a democracy, the recommendation of the DOF was not approved. If we did the unitary immediately, we would not see this downshifting in cigarette brands.”

Uniform taxation

Meanwhile, Julie Hall, WHO country representative, said the survey result is a “great start to the introduction of the Sin Tax Law here.”

“You increase the price of tobacco, you will decrease the number of people smoking and decrease the number of deaths. The Sin Tax Law that was passed is a great and very important piece of legislation. It will save lives but it will also increase taxes,” she said.

Hall said people are sensitive to prices so smokers shift to cheaper brands.

“Smokers do respond to prices and when there is a single level of taxation for all brands and all brands essentially cost the same, they won’t be able to switch brands,” she said. 

A uniform taxation for all brands of cigarettes must be passed into law, Hall said. 

‘Enforce anti-smoking law’

 For his part, Western Samar Rep. Mel Senen Sarmiento asked yesterday the Inter-Agency Committee- Tobacco, Philippine National Police, Metropolitan Manila Development Authority and local government units to ensure the full implementation of Republic Act No. 9211 or the Tobacco Regulation Act of 2003.

Sarmiento issued the statement as the House of Representatives has prioritized a bill mandating the placement of picture-based health warnings on tobacco products, authored mainly by Albay Rep. Edcel Lagman Jr., and Aklan Rep. Teodorico Haresco.

“We have so many laws that end up useless because there seems to be no real effort to enforce them and our anti-smoking law is one of them. I think that our implementing agencies should step up a more aggressive and sustained campaign to stop smoking in public places,” Sarmiento said.

The lawmaker said he had seen drivers of public utility jeepneys and buses who are smoking inside their vehicles in full view of traffic enforcement officers and policemen.

He said there are also some restaurants in Metro Manila, particularly in Pasay City and Makati City which allow smoking inside their premises instead of setting up a separate smoking zone.

Haresco said smoking tobacco products is one of the leading causes of death and diseases in the country, but with the Philippines being one of the countries with the lowest price of tobacco products, Filipinos as young as 13 years old freely patronize them. – With Sheila Crisostomo, Paolo Romero