‘Sin’ no more

It is like a do-or-die thing for the proposed bill that seeks to raise taxes anew on tobacco products. With less than two weeks remaining before the 17th Congress bows out of existence on June 7, this so-called “sin” tax bill is literally facing prospects of death.

There are at least three Senate bills on higher “sin” tax on tobacco products authored by Senators JV Ejercito, Manny Pacquiao and Sherwin Gatchalian. Sen. Sonny Angara, who chairs the Senate ways and means committee, will become the fourth author as he is the one sponsoring its approval at the floor.

Before they resumed sessions, no less than Senate president Vicente Sotto III and Senate president pro tempore Ralph Recto declared they will prioritize the passage into law of bills that are already in advanced stages of the legislative process, especially those on third reading and those pending at the bicameral conference committee, or bicam for short.

Sotto and Recto have cited lack of material time may prevent the approval of pending House-approved tax bills that included the “sin” tax on tobacco.

Although an author of one of the bills, Gatchalian admitted it would be difficult to pass the measure with only a few session days left and many reservations raised by several of his colleagues on the new round of taxes.

After the leaders of the Senate earlier predicted the demise of the proposed “sin” tax on tobacco products, there is now an ongoing flurry and loud calls for the Senators to approve it.

This came about after Department of Finance (DOF) Secretary Carlos “Sonny” Dominguez met in closed-door session with the Senators two days after they went back into sessions last week. The DOF, along with the Department of Health (DOH), are primarily the agencies pushing for the approval of the “sin” tax on tobacco.

Dominguez pleaded with the Senators to reconsider their previous public pronouncements, citing the need to fund the Universal Health Care (UHC) Law. From calculations of the DOF, without a new sin tax reform law, UHC will be left with a funding gap of around P62 billion in the first year alone.

With this additional funding source for the UHC, the DOH assured, that the Philippine Health Insurance Corp. (PhilHealth) coverage of its members will expand to cover 120 drugs and there will be no limit to primary care treatment. 

The DOF and DOH have appealed to Congress to approve a P60 per pack increase in the excise tax for cigarettes, with a nine percent hike every year thereafter. On the other hand, the current Senate formula of a staggered increase of P45 for the first year, with incremental increases of P5 until it reaches the P60 level, is still acceptable for both government agencies. 

Reconciling such differing versions will thus go through the bicam, or the so-called third chamber of Congress. It is where the conflicting provisions of the Senate and House bills are reconciled and consolidated into one. The finalized version of the bill then goes back to both the Senate and the House for plenary approval into law.

According to the Finance Secretary, President Rodrigo Duterte has certified this “sin” tax bill on tobacco products as urgent administration measure for immediate approval into law. The presidential certification will thus fast track its approval and eventual signing into law.

With the six re-electionist Senators still fresh from the just concluded midterm polls – but only four of them won – the passage into law of the proposed higher “sin” taxes on tobacco products is something that would test if they would make good on their campaign promises.

One of them is Angara. Still fresh in the minds of voters is Angara’s having shepherded the approval into law of the Tax Reform Acceleration and Inclusion, or TRAIN Law for short. President Duterte signed it as Republic Act (RA) 10963 on Dec. 19, 2017.

The end game of this higher “sin” tax on tobacco is to kill the smoking habit of Filipinos. 

It’s a noble and worthy cause and will definitely be beneficial to promote better health for the people. If cigarette smoking is deleterious to smokers, the DOH has repeatedly warned, it has the same effects to even non-smokers exposed to this health hazard. Secondhand smoke is as much deadly.  

Thus, the DOF and the DOH are already looking at imposing the same “sin” taxes to alternative smoking devices such as vapes. Collectively called as electronic nicotine delivery system, or ENDS, there are new scientific studies to prove the case for e-cigarettes as a viable solution to smoking cessation. Recent research published in the New England Journal of Medicine – one of the world’s leading medical journals, concluded that e-cigarettes were more effective in helping smokers quit than traditional nicotine-replacement therapy products (NRT). 

According to the Global Adult Tobacco Survey, there are over 16.6 million Filipino tobacco smokers, of whom, 76.7 percent planned or were thinking about quitting, and 56.5 percent who visited a healthcare provider in the past 12 months and were advised to quit smoking. However, only less than four percent are able to successfully quit.

The Philippine government is studying for now ways to regulate the distribution and sale of vapes and other e-cigarette devices.

This comes at the heels of the entry into the Philippines of the fast-growing and popular e-cigarettes that are specifically designed to wean away cigarette smokers but at the same time satisfies their nicotine addiction, without the cancer-causing tar ingredient. Unlike cigarettes that contain carcinogenic ingredients like tar, the biggest selling e-cigarette brand Juule in the US would soon be sold in Philippine stores.

But since this Congress is already winding down next week, it would be the subject of the new “sin” tax in the 18th Congress.

Although it seems to be uncertain whether the ”sin” tax on tobacco bill will be passed or not, action speaks louder than words in the halls of Congress. For those who cannot keep their campaign promises, “sin” no more please.