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Pinoys should expect health windfall from record sin tax revenues – AER

Posted On 2014 Jan 20
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Action for Economic Reforms

Action for Economic Reforms

MANILA (Mabuhay) – Filipinos should expect a health windfall after record revenues from the Sin Tax Law, which is entering its second year of implementation.

From January to November last year, the Bureau of Internal Revenue collected P91.6 billion from excise taxes on tobacco and alcohol products and another P41.1 billion in incremental revenues, the Action for Economic Reforms said.

“One year since the enactment of R.A. 10351, the Sin Tax Law is clearly on the right track towards attaining its health and revenue objectives,” said Jo-ann Latuja, senior economist of Action for Economic Reforms (AER).

Last year, the group said, the sin tax law ushered in a “game-change” for the country’s efforts to achieve universal health care, with the single largest budget increase ever for the Department of Health, a 57.9 percent increase from 2013’s P53 billion to this year’s P83.7-billion—the fifth largest allocation to a line agency.

“We are expecting even greater health dividends to materialize in 2014,” Latuja said. “Excise tax collections have hit record highs, and there are numerous indications that the law is gradually making a dent on levels of cigarette consumption.”

A November 2013 rapid tobacco survey by the DOH and AER found cigarette consumption among 304 smokers in Cotabato declined by 24 sticks on average.

With increased health spending expected this year, “it will be our country’s poor, most of all, who will gain from this,” Latuja said.

Last month, Health Secretary Enrique Ona said the incremental revenues from the Sin Tax Law, which are given to the DOH, would be used to fund Philhealth premiums for the poor and non-poor, fund the upgrading of government hospitals and health facilities, expand public health programs such as immunization, and hire health workers to support the implementation of the universal healthcare program.

In the DOH’s 2014 budget, the largest increases in spending are for the non-communicable disease prevention and control program (a 729 percent increase to P586 million) and for health insurance subsidies for the poor (a 179 percent increase to P35.3 billion).

Ona said the increased budget for Philhealth premiums would be enough to meet the health insurance needs of the 14.7 million poorest families in the country.

“The milestone DOH budget in the 2014 GAA is yet another huge victory for health that has been secured by the Sin Tax Law,” Latuja said. “With these public resources assured for health, universal health is no longer just a dream, but a real possibility for our fellow Filipinos.” (MNS)

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