Santiago hits Senate committee report on sin tax bill

MANILA -- One of the proponents of the imposition of higher taxes on cigarette and alcoholic products said the Senate committee report on sin tax bill was an "abject surrender" to the lobby of people running these businesses.

"I am gobsmacked – speechless with amazement – at the committee report. It bears no recognizable resemblance to my bill," Senator Miriam Defensor-Santiago said.

Under Senate Bill 3249 introduced by Santiago, the government will raise P60 billion for the first year. By contrast, the Recto bill will earn only P15 billion. The foregone revenue, she said, could be used for funding the construction of more hospitals, rural health units and village health stations.

The tax on tobacco should be 70 percent of the price of the product if the Philippines will follow its duty under the Framework Convention on Tobacco Control.

Santiago said this is the reason why her bill imposes a tax of P30 per pack of cigarettes by 2015.

"My bill imposes a unitary tax system, as recommended by the World Health Organization. The Recto bill uses a 3-tier tax rate for tobacco and alcohol products, making them cheaper and thereby encouraging their use," she said.

Santiago said that while her bill will save 4.15 million smokers at the first year, the Recto bill will save only 2.93 million smokers.

Recto sponsored the bill on the floor on Tuesday as Malacañang and other government officials also expressed disappointment with the report of the Senate committee on ways and means.

The Palace has been pushing for the version passed by the House of Representatives in June, which seeks to generate some P60 billion in additional revenues on its first year of implementation. (Virgil Lopez/Sunnex)