Senator proposes 3-tiered tax on sugar-sweetened beverage

SENATOR Juan Miguel Zubiri proposed a three-tiered tax on sugar-sweetened beverage (SSB) during the Senate committee on ways and means hearing on the Comprehensive Tax Reform package dubbed Tax Reform for Acceleration and Inclusion (Train).

"We want to earn government revenue through the sugar tax, but we don’t want to kill the industry,” Zubiri said in a press statement.

He added that his proposal “hits the sweet spot wherein the taxation method and tax rates can address important concerns such as government’s need for revenue, need to stop the rising incidence of diabetes, obesity and dental caries among the many health issues related to excessive consumption of sugar.”

“I believe the tax rates to be adopted should also push my advocacy for the avoidance of cancer-causing high fructose corn syrup (HFCS),” the senator said.

Being studied are the following: Specific tax based on content - Tier I: 0-5 gms. per liter, exempt; Tier II: 6-12 gms. per liter, P 3; and Tier III: Above 12 gms. per liter, P5.

Based on volume: P5 per liter for those containing locally-produced sugar and P20 per liter for others which contain imported sugar and sweeteners like HFCS.

“I fully support the doctors’ position to stop excessive sugar consumption. However, we should not slap a tax rate that will make sugar, food and beverage items containing sugar very expensive. If we tax it too steeply, people may not to be able to afford it because of the high price. One example is the flavored milk drinks which improves taste and encourages milk drinking, especially among children.”

Zubiri warned that “an excessively high sugar tax could potentially lead to the collapse of the sugar industry, displacement of hundreds of thousands of farmers and mill workers, and hunger of at least five million Filipinos heavily dependent on the sugar industry.”

“Today, most sugar holdings are small farms below three hectares such as in Negros where 95 percent of farmlands have been covered and distributed under the agrarian reform program. That’s why it is so important for us to find the appropriate tax rates to slap on sugar-sweetened beverages. A collapsing sugar industry won’t be affecting large hacenderos, but the small farmers who in fact we need to support to be more productive,” he added.
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