• May 21, 2024

Taxes on taxes on taxes…

 Taxes on taxes on taxes…

Tobacco farmers and laborers in the Philippines yesterday appealed to a bicameral panel looking into tax reform to consider their plight before further increasing tobacco excise tax, according to a story in The Philippine Star.

Past and ongoing tobacco-tax increases have been blamed for a fall in tobacco production, which, according to the National Tobacco Administration (NTA), went from 68 million kg in 2013 to 52 million kg in 2015.

The Trade Union Congress of the Philippines (TUCP), the PhilTobacco Growers Association, and the Federation of Free Farmers expressed their opposition to a further rise in tobacco excise tax, citing the significant reduction in production and huge job losses following the yearly ‘exorbitant’ hikes in tobacco tax since 2013.

Under the current law, tobacco taxes automatically increase by four percent annually.

“What the proponents of a radical increase in sin tax fail to recognize is that every time a move to increase the tobacco sin tax is proposed, thousands of tobacco farmers and laborers are faced with the threat of losing their primary source of income and livelihood,” said TUCP president Ruben Torres, a former labor and executive secretary.

Torres said that data from the NTA had shown that the number of workers in the tobacco industry had been reduced by 9,232 farmers in 2015 alone.

Another related NTA report had shown there was also a decline in the area of the land planted to tobacco from 38,264 ha in 2014 to 32,761 ha in 2015.

He said that the tobacco industry had already contributed greatly to the national coffers. Despite the tobacco farmers’ contribution to the national income, it was unfortunate that this sector was always targeted as the sole ‘big’ source of national revenues for the government.