Press release – Action for Economic Reforms – 26 November 2012

Civil society today called for the Bicameral Conference Committee meetings for sin tax to be held publicly for the media to cover.

“We need to make it open so we will prevent killer insertions, knowing that the Bicam is shrouded in secrecy,” stated Dr. Anthony Leachon, DOH consultant on non-communicable diseases.

“Since this is one of the most lobbied bills in many years, the public and civil society should know what’s going on during the meetings,” continued Leachon.

Leachon recalled what happened to the Cybercrime Law where last minute “killer provisions” were inserted during the Bicameral meetings and said, “We don’t want these provisions that will undermine the credibility of the reform and lead to adverse, unintended consequences.”

He asserted that the Universal Health Care (UHC) earmarking should not have a sunset provision until 2016 and that Senator Ralph Recto’s insertion of additional funds is “redundant” because there is already earmarking for UHC and alternative livelihoods. This, he said, would result to “inefficiency and waste.”

Leachon also added that the provision mandating all manufacturers to buy 20% of Virginia tobacco should be removed. “This is a violation of Article 3.5 of the General Agreement on Tariffs and Trade. This makes the law susceptible to being amended and diluted in the future.”

He emphasized that the Bicam should incorporate the best features in the House and Senate versions and should uphold the following essential reforms:

1.      Unitary tax

2.      Indexation to inflation and growth rate (this prevents erosion of revenues and make sin products less affordable to young and poor)

3.      Earmarking of incremental revenue for Universal Health Care and alternative livelihood for tobacco farmers

4.      Incremental revenues of at least 40B for the first year, with progressively increasing tax rates over the medium and long term

Dr. Antonio Dans of the UP College of Medicine also expressed his concern that legislators seemed to forget the bill’s primary health objective. “What we are losing in this current debate is that the sin tax is a health measure.”

Dans objected to the lower unitary tax on cigarettes, which was adjusted from the original P32 in Senator Frank Drilon’s measure to only P26 per pack by 2017. Under the Drilon version, an estimated 66,000 lives will be saved. By adjusting the rate to only P26, that meant “only 41,000 lives will be saved.”

Dr. Maricar Limpin, Executive Director of the Framework Convention on Tobacco Control Alliance Philippines (FCAP), also asserted that anti-health legislators be excluded from the Bicam meetings.

“Their only intention is to lower the tax rates. Bakit sila sasama sa Bicam kung hindi naman sila naniniwala sa [health] intention ng sin tax?” said Limpin. “It’s not too much to ask from them.”

“What they are saying is that they are protecting the welfare of farmers and workers. That’s not true,” argued Limpin. “Ang tunay na interes nila ay ang dami ng kinikita nila.

Leachon added that the bill will also save tobacco farmers from illnesses, as they also die from tobacco-related diseases.