Press Release
August 28, 2012

ANGARA CALLS FOR A MORE EQUITABLE SIN TAX BILL

Senator Edgardo J. Angara stressed that it is important to consider the different classifications of cigarettes and liquors in imposing excise tax under the proposed amendments of the sin tax bill.

"Stakeholders have different interests. For example, there are low-priced cigarettes and premium-priced cigarettes, same as for liquor. So taxes should depend on the classifications. We have to weigh and study each classification just to be equitable," Angara said in a TV interview.

Under Senate Bills 2763 and 3249, excise taxes on liquor are computed based on alcohol content and per liter of volume capacity while excise taxes on cigarettes are imposed per pack.

Both measures aim to raise taxes on alcohol and cigarettes through a unitary taxation system regardless of price so it would be easier to administer and monitor.

However, beer and cigarette companies have already raised their concerns that the proposed sin tax measures tend to discriminate against low-priced brands since they would incur the biggest tax increase.

Angara, a member of the Senate Committee on Ways and Means, suggested an ad valorem tax instead, where a uniform rate would be levied across all products based on their price.

As the House of Representatives has already approved its version of the measure, Angara is optimistic that the Senate will also pass its counterpart sin tax bill.

"This will pass. The only question is the adjustment of excise taxes for each category. This is the primary contention," he said.

The senator also expressed hope that the measure will achieve its goal of deterring young people from smoking and drinking alcohol, and protect them from the lifelong consequences of smoking and alcohol abuse.

"When cigarettes are too cheap, young people will be encouraged to smoke. But if they are more expensive, they will think twice," Angara said.

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