‘Sin’ tax collections seen reaching P480B by 2024

22-Feb-2020 Intellasia | Inquirer | 6:02 AM Print This Post

Tax collections from so-called “sin” products were projected to reach at least P480 billion by 2024, which would help fund universal health care, according to the Department of Finance (DOF) on Friday (February 21).

In a statement, Finance Undersecretary Karl Kendrick T. Chua said the “low-end” estimates for total sin tax collection four years from now were expected with the implementation of Republic Act No. 11346 which raised taxes on cigarettes and another law, Republic Act No. 11467, which did the same for alcoholic drinks, vapes and heated tobacco products.

The two tax laws took effect starting last January 1.

Higher taxes on sugary drinks was part of the Tax Reform for Acceleration and Inclusion (TRAIN) Act that is being implemented since 2018.

From cigarettes alone, excise collections were programmed to hit P14.9 billion in 2020 and jump to P125.8 billion by 2024, Chua said.

The increased levy on alcohol, heated tobacco and vapes will raise P22.2 billion in 2020.

Revenues from higher taxes on alcoholic drinks, vapes and heated tobacco were expected to reach P137.2 billion from 2020 to 2024.

Chua said 60 percent of revenue from increased taxes on alcohol and vapes would go to universal health care while 20 percent to medical assistance and health facilities.

He said the remaining 20 percent will be for programmes to “help the government fulfill commitments” to the United Nations Sustainable Development Goals.

In 2018, taxes from sin products reached P269.1 billion although below the P284.2 billion target.

DOF data showed that the government collected P147.4 billion in taxes from cigarettes, P79.7 billion from alcoholic drinks and P42 billion from sugary drinks.

This year, the government aims to collect P332.3 billion since electronic cigarettes, heated tobacco and vapes are covered plus additional taxes on alcoholic drinks and cigarettes, Chua said.

Higher taxes on sin products were not meant only to generate more revenue but also cut “consumption of unhealthy products to help lower health care costs and promote a health citizenry,” the DOF said.

https://business.inquirer.net/290994/sin-tax-collections-seen-reaching-p480b-by-2024

 


Category: Philippines

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