House approves three remaining Duterte admin tax packages

December 3, 2018

The House of Representatives on Monday approved the three remaining tax packages of the Duterte administration’s Comprehensive Tax Reform Program (CTRP)

Approved were House Bill 8677 to increase excise taxes on tobacco, House Bill 8618 to raise excise tax on alcohol products and  House Bill 8645 or the “Passive Income and Financial Intermediary Taxation Act of 2019”.

Earlier, Speaker Gloria Macapagal-Arroyo vowed to pass the legislative agenda of President Duterte. These  measures will be transmitted to the Senate.

House Bill 8677, which was tagged as part of the Package 2 Plus of the CTRP, will raise the current tax of P30 per pack of cigarettes to P37.50 beginning July 2019. It will be increases further to P40 in July 2020, P42.50 in July 2021, and P45 in July 2022. Thereafter, the rate shall be raised four percent every July annually.

Voting 187-7-1, lawmakers approved the measure which seeks to amend Republic Act 10351 or the Sin Tax Reform Law enacted in 2012.

The bill also sought to address prevalence of smoking and its negative consequences on health of the population and its cost to the economy.

Deputy Speaker Sharon Garin said government is expecting P2.7 billion in revenue from the passage of additional tax for tobacco products.

Revenues from excise tax on tobacco as well as alcohol products will fund the proposed Universal Health Care (UHC) Act.

The UHC bill is going through the bicameral conference committee, and is expected to be signed into law by the end of 2018.

According to the Department of Health, around ₱164 billion in incremental funds still needs to be generated to ensure its proper implementation.  DMS