'Gobsmacked' Miriam rejects Recto tax bill

MANILA, Philippines – Anti-tobacco groups have declared war on Sen Ralph Recto’s version of the sin tax bill. Now, Sen Miriam Defensor Santiago drums up the battle cry by rallying netizens to go up in arms.

“I am gobsmacked – speechless with amazement – at the committee report,” Santiago said in reference to the report Recto sponsored on Wednesday, October 10.

“It bears no recognizable resemblance to my bill. It is an abject surrender to the very rich and very powerful tobacco and alcohol lobby,” Santiago said in a statement on Thursday, October 11.

Santiago is a member of the Senate Committee on Ways and Means, which Recto heads. She is the principal author of one of the versions of the sin tax bill, which have been consolidated into the measure sponsored by Recto.

She admitted signing the committee report but with an annotation: “Only for the purpose of getting the bill out of the plenary session” so the debates can start on the Senate floor, she said.

Santiago said university students and social media users must join the war against the committee version of the bill, calling it “the death star bill.”

“Under the Santiago bill, government will raise P60 billion for the first year. By contrast, the Recto bill will earn only P15 billion. The foregone revenue could go to universal health care such as more hospitals, rural health units, and barangay health stations,” Santiago said.

Santiago joins Senators Pia Cayetano and Franklin Drilon in criticizing the Recto version as “watered-down.” They have vowed to push for a better version of the bill.

Civil society groups, Malacañang and the Finance Department are also not satisfied with the committee report. Advocates said it was similar to what Philip Morris wanted, calling it the “Ralph Morris” bill. They are calling on Recto to resign as chairman of the committee

Under the Recto bill, government will raise additional revenues of P15 billion to P20 billion. This is way below the P31 billion target in the version already passed by the House of Representatives. (The government's initial revenue target in the proposed law is P60 billion.)

This marks the first time in 15 years that the sin tax bill has reached this far in the legislative process. Previous attempts to reform the excise tax system never made it past committee level.

The battleground has shifted to the Senate.

Recto insisted that the bill is “reasonable, realistic and responsible.”

“We just hosed down promises of windfall tax revenues that were based on wrongful assumptions,” Recto said.

Simpler tax system, int’l commitments

Santiago also said her version of the bill was more faithful to the Philippines’ international commitments like the Framework Convention on Tobacco Control. She said that based on the treaty, tax on tobacco should be 70% of the product’s price.

The senator added that her bill imposes a unitary tax system, which is more simplified compared to the multi-tier system proposed by Recto.

Santiago added that a multi-tier system is more prone to corruption and abuses.

“My bill imposes a unitary tax system, as recommended by the World Health Organization. The Recto bill uses a 3-tier tax rate for tobacco and alcohol products, making them cheaper and thereby encouraging their use,” Santiago said.

‘Death is not entertainment’

Santiago also cited health as grounds to oppose Recto’s bill. She said her bill will save 4.15 million smokers in the first year while Recto’s will save only 2.93 million smokers.

“My bill will raise the prices of cigarettes and alcohol but it will save the lives of 240 Filipinos everyday. Cigarette smoke contains 60 chemicals which cause cancer, “ Santiago said.

She also rejected the argument that cigarettes and alcohol are the entertainment of the poor.

“The purpose of entertainment is relaxation and not death,” she said. – Rappler.com