Sugar leaders oppose excise tax on sugar sweetened beverages

SUGAR leaders in Negros Occidental have expressed strong opposition to the proposed excise tax on sugar sweetened beverages as it could hurt the industry.

In a statement issued Sunday, May 21, former vice governor Emilio Yulo III, spokesperson of Sugar Alliance of the Philippines, said the move “will further bring the sugar industry down.”

“This is double whammy as far as we are concerned and we have sent representations to both Houses of Congress to hear our appeal,” he said.

Last week, a House bill increasing the excise tax on sugar sweetened drinks, including high fructose corn syrup (HFCS), was filed by Sultan Kudarat Representative Horacio Suansing Jr. and his wife Nueva Ecija Representative Estrellita Suansing.

Under the proposal, which seeks a P10 per liter excise tax on sugar sweetened beverages, 20 percent of the fund will go to Sugarcane Industry Development Act (Sida) while the 80 percent will be allocated to the General Fund.

Mr. Suansing, who was born in Bacolod City, said the proposed measure is seen to remedy the excessive importation of HFCS to protect the sugar producers and industry.

However, the Visayan Bloc in the House of Representatives led by Negros Occidental Third District Representative Alfredo Benitez is looking to reduce the proposed excise tax authored by the Suansings.

Abang Lingkod party-list Representative Stephen Paduano said they are pushing for a P5 per liter excise tax on sweetened beverages to minimize its effects on the sugar industry.

Yulo said they appreciate the move of the Visayan Bloc.

“We met with some of them last week to discuss how to further reduce the proposed tax,” he added.

He said the sugar leaders are aware that “it has been certified urgent by the administration so that our fiscal standing will not be affected by the proposed reforms in income taxes.”

“However, we appeal that the sugar industry be spared from this, considering the present situation we are in due to the unabated entry of HFCS,” Yulo added.

The unregulated entry of HFCS, an alternative sweetener used by beverage firms, had caused a massive drop in sugar prices which alarmed the industry leaders.

Yulo said they are thankful to Benitez and other lawmakers in the Visayas for seeking the reduction of the excise tax on sugar sweetened drinks.

“We continue to hope that we will be given at least a five to six-year exemption from this or at the very least a staggered implementation of excise tax on sugar sweetened beverages,” he said.

Yulo said the sugar industry, which has a P2-billion allocation from Sida, is just starting its modernization to be “more productive” and “globally competitive.”

“Having this excise tax implemented now will just defeat the very purpose of the fund coming from government,” he added.

Yulo said that Benitez told the sugar industry leaders that 15 percent of the excise tax revenues, which is about P7 billion, will be added to the fund of Sida.

“This may hasten the 10-year development plan for the industry and we are thankful for that,” he added.

However, Yulo reiterated that the proposed tax reform eyed to be implemented soon will “probably hurt the sugar industry badly.”

“We are also joining cooperatives opposing the elimination of their exemption from taxes as we have hundreds of agrarian coops in the sugar industry who have survived because of these exemptions. Taking that away from them, coupled with the additional excise tax will spell doom for our already embattled sugar industry,” Yulo further said.
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