A proposed bill taxing cigarettes heavily is the latest of Senator Manny Pacquiao’s knockout punch. He hasn’t scored a KO in eight years in the boxing ring but on the Senate floor, the neophyte lawmaker has surprisingly dished out some.
His latest bill seeking higher taxes on tobacco–Senate Bill No 1599–seeks to amend Republic Act 10351 or the Sin Tax Reform Act of 2012. The measure seeks to increase the current unitary excise tax rate to P60 from P30 per pack, and the annual excise tax to 9% from 4%.
The proposal could increase government funds by P60 to 70 billion a year from the taxes it will generate. There is a House of Representatives version of the tax amendment filed in December 2016 which is House Bill 4144. However, unlike Pacquiao’s version, the House passed a bill seeking a two-tier tax scheme for cigarettes. HB 4144 proposes a P32-tax on cigarette packs with a net retail price of P11.50 and below, and P36 for packs that cost more than P11.50.
Senator Pacquiao’s measure is a “killer blow” to the tobacco industry but a massive generator of much needed revenues so there lies the catch.
The Senator slash boxing legend, who admits of not smoking a single stick of tobacco, is not afraid to bang heads with tobacco business as he flaunted a sports career bereft of any tobacco sponsors given that the same is prohibited.
With a determined bid to tax vices like smoking heavily, the question now is whether or not this heavier tax on tobacco will hurdle the Senate.