Abad lauds House for approving sin tax bill

Thursday 7th of June 2012

QUEZON CITY, June 7 (PIA) -– Budget and Management Sec. Florencio Abad praised the House of Representatives today for approving House Bill 5727, a proposed amendment to the existing excise tax system on tobacco and alcohol products, even as he urged the Senate to pass the said bill.

The government expects to increase revenue by around P33 billion in the first year of implementation of the new "sin taxes."

Abad said most of the revenue will be allocated for critical health services, including health coverage for indigents and informal sectors under the National Health Insurance Program; and rehabilitation of health facilities in various regions.

“Once approved, 15 percent of sin tax revenues will also be used to support tobacco farmers, who may be adversely affected by the measure. Tobacco- and non-tobacco growing provinces will likewise have a share in the revenues generated by an updated excise tax regime,” he said.

The budget chief added that under the proposed bill, excise tax collections are to increase yearly.

“More importantly, however, restructuring the sin tax system will go a long way toward improving the health and well-being of Filipinos. At present, tobacco and alcohol products enjoy very low retail prices in the country, and an updated sin tax scheme will help discourage Filipinos—particularly the youth—from engaging in harmful health practices,” he said. (NFK/PIA-GHQ)