Tobacco farmers appeal for relief from excise tax hikes

Under Senate Bill No. 1599, excise tax on cigarettes and other tobacco products will be increased from the current rate of P35 per pack to P60 per pack on the first year of the law’s implementation and increase further by nine percent annually for several years thereafter. REUTERS

MANILA – Tobacco farmers across the country on Monday appealed to senators against further increasing the tobacco excise tax as this would exacerbate their increasingly difficult situation.

The Senate committee on ways and means, chaired by Senator Sonny Angara, is set to take up on Tuesday proposed measures to increase the excise tax on tobacco.

“Our very livelihood is at stake and providing for our families and the education of our children remains a big question since we have been suffering since 2013,” they said in a joint statement.

PhilTobacco Growers Association (PTGA) president Saturnino Distor said it has been tough times for their industry since demand for tobacco products have been on a decline, after the levying of steep taxes which caused retail prices to shoot upward.

From 2013 to 2018, there have been seven consecutive tax increases in tobacco products.

Distor cited that from a tax of PHP2.70 per pack of the cheapest cigarette in 2012, this is now a high of PHP35 a pack with yearly increases of 4 percent. And because of this, tobacco production volume is down to 48 million kilograms in 2017 from 68 million kilograms in 2013 as reported by the National Tobacco Administration (NTA).

At ngayon wala pa pong isang taon mula nung huling pagtaas noong July 2018 ay itataas na naman ang buwis ng tabako,” Distor said.

In December 2018, the House of Representatives approved House Bill (HB) 8677 on tobacco taxes on third and final reading, which would increase the tax on every cigarette pack from the current P32.50 to P37.50 in July 2019.

The measure would then impose a P2.50 tax increase every year until July 2022, when a cigarette pack would cost P45 each. A 4-percent tax increase would then be imposed annually starting July.

In 2017 alone, the government has collected P126 billion in revenues from the tobacco excise tax.

Health secretary Francisco Duque earlier said that increasing the tobacco tax would not only fund the proposed universal health care program of the government, but also lower smoking prevalence in the country from 21.6 percent of the population down to a target of 15.7 percent.

The Department of Health has said about PHP257 billion is needed for the first year of the program’s implementation.

Meanwhile, tobacco farmers from the provinces of Ilocos Norte, Ilocos Sur, Pangasinan, Launion, Isabela, Cagayan, Misamis Oriental, and Abra also appealed to lawmakers to be a bit sympathetic of their plight.

They cited that since the successive excise tax hikes, cigarette consumption went down to 30 billion sticks and 20 million kilos of farmers’ tobacco harvest were not purchased.

The farmers groups that made the appeal also include the National Federation of Tobacco Growers Association and Cooperatives (NAFTAC), Pasuquin Tobacco Growers Association, Narvacan Tobacco Growers Association, Leet Bansal Erfe Tobacco Farmers Association, Velasco Tobacco Farmers Association, Sinait Tobacco Growers Association, Northeastern Bacarra Tobacco Farmers Association, San Juan Ilocos Sur Tobacco Farmers Multi-purpose Cooperative, Sta. Isabel Sur Tobacco Farmers Credit Cooperative, Galimuyot Tobacco Farmers Association, Burgonians Tobacco Farmers Association, Tobacco Air-Cured Burley Association, Alcala Tobacco Producers Cooperative, Gumaod Tobacco Farmers Organization, Hinaplanan Jgalon Farmers Group, Jolly Tobacco Farmers Association, Masai Tobacco Farmers Association, Tamboboan Farmers Club, Sta. La Luna Farmers Club, Aposkahoy Tobacco Farmers Association, Madasig Group of Farmers and Rizal Tobacco Farmers Club. (PNA)


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