Intl health advocates applaud commitment to tobacco tax reforms in PH

“Tobacco use is a deadly addiction that kills six million people annually.  Tobacco tax, particularly when tied to inflation, provides a unique win-win for governments.  Tobacco tax is the strongest measure a country can take to reduce tobacco-caused death and disease while raising significant, much needed revenue.   Dedicating a portion of these revenues to health care and alternative livelihoods for tobacco farmers would be an additional step towards protecting the Philippines from tobacco’s harms.  We applaud the commitment of Filipino leaders to support strong tobacco prevention policy.”

This was according to Cynthia Lewis, Senior Program Officer of the Bill & Melinda Gates Foundation, in relation to the present talks on tobacco tax reforms in the country.

The current multi-tiered system taxes tobacco brands registered after 1996 higher than the old brands because of the price classification freeze. These tax rates are not automatically adjusted to inflation.

“This system of taxation allows for affordable cigarettes in the country. The Philippines has one of the lowest cigarettes prices in Asia with a tax burden of only 24% to 53% which is a far cry from the 70% WHO standard. If we increase the prices, the population, particularly, children will be discouraged from purchasing cigarettes. Lower tobacco consumption would decrease the burden of Non Communicable Diseases (NCDs) in the country, with it being the leading preventable risk factor for NCDs. This would save our country from spending an estimated P218 to P461 billion due to health care and productivity losses,” explained Atty. Irene Reyes, Managing Director of HealthJustice.

Just recently, HealthJustice received a Bloomberg Award for its efforts on tobacco control legislation specifically on monitoring tobacco industry interference in the country.

“Low cigarette prices give rise to high consumption and prevalence of deaths and diseases. The need to reform the current excise tax system is most immediate now more than ever. Every hour, ten Filipinos die because of tobacco. We need to protect our people from tobacco,” challenged Dr. Ulysses Dorotheo, Project Director of the Southeast Asia Initiative on Tobacco Taxation.

By removing the price classification freeze, moving to a single-level tax structure, indexing prices according to inflation, and constantly increasing these excise taxes through appropriate legislative reforms, the health and revenue objectives of the country can be achieved. More about these recommendations can be found in Taxing Health Risks, a policy paper on Tobacco Excise Taxes and Health Promotion published by HealthJustice Philippines, in collaboration with the University of the Philippines College of Law.