NegOcc Provincial Board backs sugar excise tax reduction bid

THE Negros Occidental Provincial Board urged lawmakers in the House of Representatives to reduce the proposed excise tax on sugar sweetened beverages and similar products to prevent adverse effects to the sugar industry.

The move was made through a resolution proposed on mass motion and was approved during the Provincial Board’s regular session Wednesday, May 24.

Fifth District Board Member Alain Gatuslao, chairman of committee on laws, rules and ordinances, said this is in support of the efforts of congressmen under the Visayan Bloc asking for a lower excise tax on sugar sweetened commodities.

Gatuslao said the Provincial Government is set to distribute copies of the resolution to local government units (LGUs) in Negros Occidental as well as to other provinces.

It will also be sent immediately to Congress which is currently on period of amendments, he added.

“We need to have our sentiments known to other provinces so that they can also extend support to the bid of the Visayan Bloc,” Gatuslao said, adding that the appeal is also in solidarity with all families earning through sugar production, retailing, and other related-activities.

Negros Occidental Third District Representative Alfredo Benitez said on Tuesday, May 23, that he already submitted a proposal to the House committee on ways and means to lower the proposed excise tax on sugar sweetened beverages from P10 to P5 per liter.

The Negrense lawmaker also proposed to remove the additional excise tax of P4 per liter every year on all products using sugar as sweeteners.

The Provincial Board, in its resolution, did not specify the amount of reduction it seeks.

Gatuslao, however, said it would be better if the amount will be lower than the proposal of Benitez.

“We will leave that for the Congress to decide,” he added.

The Sugar Alliance of the Philippines earlier asked Benitez to lobby for more reduction up to P2.50 per liter, and a moratorium of five to six years.

Amid the pronouncement that the proposed cut on excise tax reduction would result to about P22-billion cut in the government’s projected earnings, the board members believed that it may bring more damaging effects to the industry.

“We feel that it could eventually result to bigger amount of losses to the sugar-producing provinces like Negros Occidental as well as to the livelihood of their constituents,” Gatuslao said.

The Provincial Board is also worried that with higher excise tax, companies may resort to alternative sources of sweeteners which could hurt local economy, he added.

Governor Alfredo Marañon Jr. also supported the proposal of Benitez to lower the proposed excise tax and to grant the 15 percent of the proceeds from excise tax to the sugar industry.

“Like in the sin taxes from tobacco, tobacco-producing provinces are given their share,” the governor pointed out.

Revenue sharing

Abang Lingkod Party-list Representative Joseph Stephen Paduano on Wednesday, in a press statement, proposed that the 15 percent share in the projected P3.5 billion incremental revenue from the P10 per liter excise tax should be directly given to the sugar milling districts through the Sugar Regulatory Administration.

Benitez had earlier agreed to allocate the 15 percent proceeds share to the Sugar Industry Development Act which he authored, providing an annual fund of P2 billion to the sugar industry.

Paduano, also a Negrense, said his proposal will ensure an equitable distribution of sugar-sweetened beverage excise tax collection among sugar milling districts.

“This will ensure that everyone benefits, especially those mostly affected by the excise tax,” he added.

Paduano added that for beverages using 50 percent local sugar and 50 percent high fructose corn syrup (HFCS), the excise tax rate should be P5 per liter.

For products using 40 percent and 49 percent sugar and HFCS, the excise tax rate should be P8 per liter while P10 per liter for those using 39 percent local sugar and below.

“The 15 percent share for the sugar famers shall also be collected from the total sugar sweetened beverage excise tax revenue and will form part of the Sugar Amelioration Fund for the sugar workers and sugar mill workers,” Paduano said.

The remaining collections shall be distributed to the General Fund and other priority programs of the national government, he added. (with reports from MPE and TDE)
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