Abad praises House to pass HB 5727

This article was last updated on April 16, 2022

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The House of Representatives passed House Bill 5727 on Wednesday as the Finance Secretary Cesar Purisima called on the Senate to pass the sin tax reform bill where the measure’s author Cavite Representative Joseph Abaya felt confident it would also breeze through the upper chamber.

Florencio Abad who is the Budget and Management Secretary lauded the House of Representatives for approving House Bill 5727, a proposed improvement to the current excise tax system on tobacco and alcohol products.

Abaya said, “We are confident that it will follow the same fate in Senate, however, it will require vigilance from supportive senators, health advocates, media and the people to ensure that the bill doesn’t get watered down”. “This is landmark legislation since we have put in a reformed tax structure for sin products which has remained virtually unchanged for the last 16 years” he added.

The Philippines’ government urged the Senate to follow the suit and welcomed the sanction of the bill to reform the country’s existing sin tax on cigarette and alcoholic products.  

The bill would cut the cigarette tax brackets from 2 to 4 and these were expected to put in P33 billion in the first year of implementation of the new sin tax to the government revenues.  

Existing cigarette excise taxes has been operated on a tiered system but it relied on the year the product was introduced to establish rate of duty and prices which protected older brands at 1996 duty rates.

The excise duty level was based on the raw material from which the alcohol is distilled and preferred drinks that locally produced over imported products.