Study on excise tax for sugar-sweetened beverages needed

A THOROUGH study and consultation with affected business sectors and consumers are needed first before the implementation of the excise tax on sugar-sweetened beverages, said Davao City Chamber of Commerce and Industry, Inc. (DCCCII).

"We'll have to really look into that in depth and maybe consult with the different sectors that are affected because there might be some things that our lawmakers have not seen in terms of the excise tax probably being levied on smaller consumers. I think it has to be studied in depth before we consider an excise tax on sugar," DCCCII president Ronald Go said.

The excise tax on beverages with locally-produced sugar is in relation to the probable implementation of House Bill 5636 or the Tax Reform for Acceleration and Inclusion (Train). Section 150-A, in particular, says that there will be an excise tax of P10 for every liter of sugar-sweetened beverages containing locally-produced sugar and P20 per liter excise tax for others.

Included in these sugar-sweetened beverages are sweetened juice drinks, tea, and coffee, carbonated beverages with added sugar, flavored water, energy and sports drinks, powdered drinks with sugar, cereal and grain beverages, and other non-alcoholic drinks with sugar.

Exempted from these are powdered and liquid milk, 100 percent fruit and vegetable juices, meal replacement beverages, ground coffee, and unsweetened tea.

The price increase may vary from 10 percent to as high as more than 100 percent. As per price survey of the Department of Finance (DOF), a liter of Coca-Cola will increase its price from P27 to P38, sachet of powdered juice drinks will increase price from P9.75 to P20.75, and Zest-O juice drink from P10 to P13.

In earlier separate reports, DOF said Health Promotion Fund will be sourced out from the revenues of this sugar excise tax should this be pushed through. Around 15 percent of the amount will be given to sugar-providing provinces to improve income of sugar farmers.

The remaining 85 percent will be used for other programs of the government such as operationalization of measure for non-communicable disease prevention, sports facilities provision, access of potable water in public schools and public places, and nutrition labeling.
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