Life is taxing

Increasing the excise tax on cigarettes by more than 70 percent to P60 a pack would ‘help’ 3.2 million Filipinos quit smoking, cutting cigarette consumption nationwide by 17 percent, according to a story in The Philippine Daily Inquirer quoting the Department of Finance (DOF).

The excise increase has been proposed in a bill sponsored by Sen. Manny Pacquiao.

In a statement issued yesterday, the DOF said Senate Bill No. 1599 included also its joint proposal with the Department of Health (DOH) to increase tobacco excise by nine percent annually following the initial increase.

At present, the unitary cigarette excise tax stands at P35 per pack, following a scheduled hike in July 2018 under the Tax Reform for Acceleration and Inclusion (TRAIN) Act.

The DOF quoted Finance Undersecretary Karl Kendrick T. Chua as saying that joint simulations of the DOF, the DOH, and the World Health Organization had shown that revenues could start to fall if the excise tax were increased above P73 per pack.

Because of this, Pacquiao’s proposal at P60 a pack was expected to be ‘beneficial because it would prompt the youth, the poor and other price-sensitive cigarette users to stop smoking,’ Chua said.

The DOF quoted Health Secretary Francisco Duque III as saying that the Pacquiao bill would prevent about 713,000 deaths and would prompt 3.2 million adults to quit smoking.