MANILA – The revenues that will be raised under the proposed higher taxes on tobacco products should all be used to fund the government’s universal healthcare program and other health projects, Minority Leader Franklin Drilon said on Thursday.
As it stands, the proceeds of the proposed increase in the excise tax on tobacco would also be earmarked for tobacco farmers and the industry.
Drilon said he will make the proposal when the period of committee and individual amendments starts on Monday.
The bill is expected to be passed before the session adjourns next week as it was certified as urgent by President Rodrigo Duterte.
“I would propose that the increases in the excise tax on tobacco as a result of the sin tax that we are working on now should be devoted solely to the universal health program and benefit the entire country,” Drilon said.
Sen. Panfilo Lacson said the government should look into the revenue leakages brought by corruption or incompetence.
“OK naman ‘yung sin tax naman dahil health measure ‘yun e para sa universal health care pero ang sinasabi ko baka naman pwedeng tignan natin yung leakages,” Lacson said in an interview.
“Kasi sa tingin ko ‘yung leakages na nagmumula sa corruption or incompetence or inefficiency mas malaki,” he added.
In a Twitter post, Lacson said there would be enough funds for the entire national budget if the sins of congressmen and senators would be taxed.
Drilon said the funds to be generated under the new measure, estimated at around P15 billion, would not even be enough to support the UHC program which would need P257 billion for the first year of implementation, with P195 billion provided for in the General Appropriations Act.
“Given the huge funding requirement of the UHC program and other health needs of millions of poor Filipinos, we have to prioritize and make clear in the law where these new funds we expect to raise will go,” Drilon said.
“The health of our people should be our number one priority,” he added.
Under Republic Act 7171, local government units that produce Virginia-type cigarettes would receive 15-percent share of the sin tax collection.
Drilon, who pushed the sin tax reform law in 2012, said the allocation due to the tobacco-producing provinces under the current law will not be affected.
He added that the share of the provinces and the value of Virginia leaf tobacco and appeared to be “inequitable and grossly disproportionate” under RA 7171.
Citing a report by the Action for Economic Reforms based on the 2017 General Appropriations Act, Drilon said the funds set aside for tobacco-producing provinces amounyed to P14.4 billion under RA 7171 and P3.61 billion under RA 8240, or a total of P18.01 billion.
The value of tobacco production by the said provinces during the period was only P3.8 billion.
“Tobacco excise tax collection allocated for the tobacco-growing regions is more than four times bigger than the value of tobacco production in 2017,” Drilon said.
Despite this, Drilon said tobacco farmers remained among the poorest in our country today.
“I hope that this inequity will be addressed in the next Congress,” Drilon said.
The minority leader also cited a 2016 Commission on Audit Report, which showed the irregularities in the utilization of tobacco excise taxes under Republic Act 7171.
“This finding of COA is just the tip of the iceberg. I am sure that a deeper examination of these funds would reveal more,” Drilon said. (GMA News)
