Tax plans challenged

A group made up of more than 50,000 tobacco growers in the Philippines has urged the government to reconsider its plan to increase again the excise tax rate on cigarettes, according to a story in The Manila Standard.
The group said the move would further harm the leaf-production industry.
The PhilTobacco Growers Association said in a letter to Finance Secretary Carlos Dominguez III that they were already feeling the adverse impact of the lower demand for tobacco caused by higher excise taxes on tobacco products.
The letter was sent also to the Senate Ways and Means Committee chairman Senator Juan Edgardo Angara, and House Ways and Means Committee chairman Rep. Estrellita Suansing.
The growers said that from P2.72 per pack in 2012 for cheaper cigarettes, the excise tax had now reached P35.00 per pack.
And the latest data from the National Tobacco Administration had shown that tobacco production had declined from 68 million kg in 2013 to 48 million kg in 2017.
The growers said they had been surprised that on top of the tobacco-tax increase of 2013, another had been imposed in 2017. “And now the government is again planning to increase the tax on cigarettes,” they said.
The growers said the proposal by Senator JV Ejercito to set tobacco excise tax at P90 per pack with a nine-percent increase annually would more than double the current tax.
The Department of Health and other sectors are pushing for the increase in excise tax of cigarettes to P90 per pack to fund the Universal Health Care bill.
But the growers said the tobacco industry already contributed billions of pesos yearly to government coffers, citing the Bureau of Internal Revenue’s figures for tobacco tax collections in 2017 that reached over P126 billion.
“Because of that, isn’t it right that we should be given the opportunity to recover?, the farmers asked.
“Isn’t it right that other sectors should also be encouraged to pay higher taxes for them to contribute to economic development?”.