VISAYAN BLOC LOBBY FAILS HOUSE APPROVES P10/LITER SUGAR EXCISE TAX



By Dominique Gabriel G. Bañaga
June 2, 2017

The House of Representatives passed yesterday the tax reform package introduced by Malacañang, which includes a P10 per liter excise tax on sugar-sweetened beverages, despite a critical amendment proposed by the Visayan Bloc to reduce the charge by half to P5 per liter.

The bloc, led by Negros Occidental Rep. Alfredo ‘Albee’ Benitez (3rd District, PDP-Laban), supported the proposed reduction but ultimately failed as the House plenary voted overwhelmingly in support of the bill certified as urgent by President Rodrigo R. Duterte recently.

Bacolod City Councilor Caesar Distrito, who authored a resolution opposing the sugar tax, expressed fears over the negative impact of additional taxes on those living in or below the poverty line. In a message the local legislator sent through Facebook yesterday, he said the additional tax will have a tremendous impact on sugar prices.

“So the effect would be, is to just add the taxes on the price of sugar, which will not redound to the benefit of our sugar workers and planters,” said Distrito.

He explained, once it is implemented, the government will get P10 as an excise tax for a liter of softdrinks, juice, or any beverage that uses sugar, either in liquid or powder form. As the prices of these items will rise, he said it would also result in lower consumption.

“Lower consumption means lower sales,” he said. “So eventually the sugar industry will suffer,” Distrito said.

Negros Occidental Provincial Board Member Alain Gatuslao, meanwhile, stated he is hoping the additional tax on sugar sweetened products will not negatively affect the sugar industry.

He said the Provincial Board recently passed a house resolution asking the members of the House Representatives to lower the tax, adding they are fully supportive of the Benitez amendments.

Abang Lingkod Partylist Representative Stephen Paduano also released a statement assuring the solons from Negros and the Visayan bloc tried to protect the sugar industry with the passage of the Comprehensive Tax Reform Package.

Paduano explained that while they were unable to reduce the P10 per liter tax on beverages using locally-produced sugar, beverages using High Fructose Corn Syrup (HFCS) will be taxed P20 per liter. The solon said it will oblige beverage companies to use locally produced sugar.

Paduano added the sugar industry will also receive P9 billion every year that represents 15 percent of the total revenues from the excise tax on sweetened beverages.

He pointed out the subsidy will be incorporated to the Sugarcane Industry Development Act (SIDA) that appropriates P2 billion for the industry every year.

“We can expect more infrastructure and other projects for the sugar industry,” Paduano added.

Earlier on Wednesday, the House of Representatives approved the tax reform package on final reading with 246 affirmative votes, nine negative votes, and one abstention. Apart from the excise tax on sugar-sweetened beverages, the measure also seeks to reduce personal income taxes while imposing additional taxes on fuel and automobiles. The measure will be transmitted to the Senate where it is expected to face scrutiny and considerably more opposition./WDJ