Gatchalian Backs Reduction of Excise Tax

by Eugene Adiong on Fri, 06/16/2017

The sugar industry has found another ally in Senator Sherwin Gatchalian in its efforts to reduce the proposed P10 per liter proposed excise tax.

Gathalian said that he expects “adjustments on the proposal especially on sugar-sweetened beverages because it is a new provision which was not discussed in the Senate.”

Pressed if government economic managers would bend to lower their proposed excise tax, he said, “they bent on the excise tax on diesel fuel which was initially at P6 but they now agreed that it be imposed in three phases- P3 in the first year, P2 in the second year and P1 in the third year.”

“In that sense, they gave in to the request of the legislature. As representatives of the people, we have to be sensitive to the voices and plight of our constituents,” Gatchalian said.

Personally, he said that “we should look at the proposed tax reform as one package.”

“The reduced income tax will benefit about 90 percent of the people. It is now at P250,000 and below are exempted. On the other hand, those who consume more fuel will pay more excise tax. We are just transferring the burden from the middle and lower class to those who consume more,” he pointed out.

Gatchalian said that it should be ensured that “jobs will not be affected.”

“Tax on sugar-sweetened beverages will be detrimental if jobs are affected. The proposal should be discussed thoroughly,” he said.

Earlier, Senators Juan Miguel Zubiri and Joseph Victor Ejercito expressed their apprehensions that the proposal to impose excise tax on sugar-sweetened beverages may cause inflationary effects on consumers.

Ejercito feels that the proposed Comprehensive Tax Reform Package that includes excise taxes on sugar-sweetened beverages, petroleum products and car sales will bring about rough sailing once it reaches the Senate as some senators are no keen on adopting the House version of the proposal.

Senator Joseph Victor Ejercito said that he “has apprehensions on imposing those excise taxes because it might have high inflationary effects despite the Department of Finance’s claim that it is negligible.”

Last week, Zubiri promised sugar industry stakeholders to fight for the reduction of the P10-a-liter excise tax on sugar-sweetened drinks.

The senator is pushing for the reduction of the P10-a-liter excise tax to P5, and for the retention of the House of Representatives–approved P20 excise tax per liter for sweetened-beverages using High Fructose Corn Syrup (HFCS) and other imported sweeteners.

Earlier, Rep. Alfredo Abelardo Benitez of Negros Occ.’s 3rd district, said the Visayan bloc failed to reduce the excise tax on sugar-sweetened drinks from P10 per liter to P5, but they were able to double the amount on imported sweeteners.

Zubiri pointed out that the tax on sugar sweetened drinks, which includes softdrinks and three-in-one coffee “needs to be reduced to prevent a drop in their sales that would gravely affect the Philippine sugar industry, of which Negros Occidental is the largest producer.”*(Eugene Y.Adiong)