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Bacolod City, PhilippinesThursday, August 30, 2012
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‘Solons flip-flopping on sin tax’

MANILA – Senator Franklin Drilon said yesterday that he was disturbed by what appears to be a “flip-flopping stand” by Philip Morris on the government’s proposal for a unitary or single tax rate for all brands of cigarettes as proposed under the Sin Tax bill.

“The government’s proposal for a unitary or single excise tax rate for all brands of cigarettes under the Sin Tax bill was even lobbied for by Philip Morris, but, in a twist of fate, the tobacco firm is now pulling back on the proposed scheme,” explained Drilon.

Drilon said that Philip Morris managing director George Farah expressed in a letter to Malacanang dated February 5, 2003 the corporation’s support to uniform specific tax for cigarettes.

Philip Morris wrote a letter to then-President Arroyo on the proposal for a one rate tax system. The corporation actually also supported a ‘level playing field’ for all manufacturers, among other things, revealed Drilon.

Quoting from the letter of PM to Arroyo, Drilon said the PM recommended to Arroyo the change to a single tier specific system from four tier specific system.

“In brief, our proposal is that the current four tier specific system should be changed to a single tier specific system over a period of three years,” Philip Morris said in its letter to Malacanang.

Drilon also informed the committee during last week’s hearing that the Philip Morris letter even enumerated the advantages of a one rate excise tax on cigarettes.

”A single specific tax should result in an increased excise tax collection,” the letter said.

The PM representative in the hearing acknowledged the veracity of the letter and conceded the merits of the unitary tax and that then and now, PM can accept the single tax rate for all brands, recalled Drilon.

”PM agrees to a uniform or one rate excise tax for all brands; there is no more reason for multiple rates for different brands,” he said.

Drilon said he was also bothered by the flip-flopping on the issue by some of his colleagues in Congress who used to support the proposed measure during previous Congresses.

Moreover, Drilon reiterated the need to pass the bill saying it would not only raise funds for government's health care program but would also help improve the health of ordinary Filipinos.

Drilon also said that poor people suffer more from smoking than the wealthy because they are unable to afford health care when beset with smoking-related diseases. Since they cannot afford proper health care, it becomes the burden of the government to provide adequate care for them.

He noted that local cigarette prices now are among the cheapest in Asia and raising the prices would not kill the tobacco industry as some opponents of the bill have claimed.

The third Senate public hearing on the proposed Six Tax bill will resume today with the other stakeholders like academe, tobacco farmers, consumers and groups opposing the measure getting their chances to air their side on the bill.*PNA


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