Sugar leaders: Sweetener tax cut snub a ‘big blow’




By Marchel P. Espina/Teresa D. Ellera
Friday, June 2, 2017

SUGAR leaders in Negros Occidental lamented the lawmakers’ snub of their bid to lower the excise tax on sweetened beverages to minimize its effects to the industry.

Sugar Alliance of the Philippines spokesperson Emilio Yulo III on Thursday, June 1, said the recent passage of the tax reform program in the House of Representatives, which included the excise tax on fuel and sugar sweetened beverage, without consideration to amendments proposed by Visayan legislators is another “big blow” to the sugar industry.

“We are still facing the unresolved issue of high fructose corn syrup (HFCS) and even before we can take a breather, we are hit again with the passage of this tax law,” he said.

Yulo said they are hoping that the Senate will make some considerations, adding that “maybe some of our champions there can do something to cushion the effect of this tax law on the sugar industry.”

“This is going to be tough sailing for all,” he added.

Moreover, Yulo thanked the Visayan lawmakers, including the Makabayan bloc, for strongly opposing the measure.

“We remain thankful to our legislators who tried their best to come up with a win-win solution intended to protect the sugar industry. However, we also know it was a numbers game and with the President himself certifying the bill as urgent, we understand their quandary,” Yulo said.

Still, Yulo said they will continue to appeal and hope that the lawmakers will continue to fight and protect the sugar industry.

He added that they are also hoping that the congressmen will try “to revisit” the bill again and urge their colleagues “to understand our plight and its impact on our embattled industry.”

‘Dead end issue’

Abang Lingkod party-list Representative Stephen Paduano said the proposed P10 per liter excise tax on sugar sweetened beverages is a “dead-end issue” for the Department of Finance.

“No amount of explanation will change their mind,” he added.

Under the tax reform package, which was approved in the House of Representatives the other day, the excise tax on sweetened beverages using locally produced sugar will be P10 per liter while those using HFCS will be taxed P20 per liter.

“This will oblige beverage companies to use locally produced sugar,” Paduano said.

Also, the sugar industry will receive P9 billion every year that represents 15 percent of the total revenues from the excise tax on sweetened beverages, he said.

The subsidy will be incorporated in the Sugar and Industry Development Act (Sida), which has an annual P2 billion appropriation for the sugar industry, Paduano said.

He added: "We can expect more infrastructure and other projects for the sugar industry.”

Negros Occidental Third District Representative Alfredo Benitez, who authored Sida, has proposed for the incorporation of the subsidy from the excise tax on sweetened beverages to Sida in addition to the P2 annual fund allocation.

According to the bill, sugar sweetened beverage will be levied with an excise tax of P10 per liter of volume capacity, which will be adjusted once every three years through rules and regulations issued by the Finance Secretary after considering its effect on the inflation rate.

The bill defines sugar sweetened beverage as non-alcoholic beverage that includes sweetened juice drinks; sweetened tea and coffee; all carbonated beverage with added sugar, including those with caloric and non-caloric sweeteners; flavored water; energy drinks; sports drinks; powdered drinks not classified as milk, juice, tea and coffee; cereal and grain beverages; and other non-alcoholic beverages that contain sugar.

Exempted from the tax package are the following beverages are: plain milk and milk drink products without added sugar; all milk products, infant formula, and milk alternatives such as soy milk, almond milk, and chocolate milk; 100 percent natural fruit juices, 100 percent natural vegetable juice; meal replacement and medically indicated beverages; ground coffee; and unsweetened tea, according to the bill.