Tobacco Tax Reforms Garner International Support

Press Release – Action for Economic Reforms – 28 August 2012

As the debates in the Senate Ways and Means Committee wage on, the Campaign for Tobacco-Free Kids are now voicing out their support for the administration’s bill.

Matthew Myers, the President of the Campaign for Tobacco-Free Kids, stressed the bill as a health measure and stated, “Enactment of this bill, especially in its stronger form, will do more to reduce tobacco use among young people in the Philippines than any other action that the government can take.”

Citing an example from Ukraine, Myers explained, “Between 2005 and 2008, the Ukrainian government gave in to tobacco industry demands and increased its tobacco tax by small amounts in a way that raised some revenue but had no impact on tobacco use.”

According to him, Ukraine increased their tax on tobacco products by 405% in 2009 and 2010. This resulted to a 13% reduction in tobacco use in 2009 and a 15% reduction in 2010.

Myers also highlighted the fierce opposition the bill is currently facing with attempts to water down the tax increase and maintain multiple tiers.

“If this happens, it means that low-cost cigarettes will be readily available to your children. If the efforts to water down the bill succeed, you are literally trading the lives of Filipino children for political compromise,” declared Myers.

“Opponents of the tax say that you can’t afford to increase the tax on tobacco products by the amount proposed because it will cost jobs and hurt retailers. How much are the lives of the 87,600 Filipinos who die each year worth?” Myers argued.

Myers further asserted that the proposed tax will help the Philippine economy, not hurt it. He emphasized that billions of pesos are being spent on unnecessary health costs and lost productivity which far exceeded what was being generated in excise tax.

“It is important to note that money, if consumers do not spend on tobacco, will not evaporate and will not be destroyed; instead it will be spent on other consumer products,” said Myers. “In other words, a reduction in tobacco use will not result in less consumer spending that will adversely impact your economy; it will simply shift that spending in ways that will often do more for the economy than money spent on tobacco.”

“The decision before the Philippine Senate may be the most important public health decision made by this session,” stated Myers. “This bill is a win-win. It will raise needed revenue and more importantly, it will save lives by effectively reducing tobacco use.”

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