Congress ratifies bill imposing additional 'sin taxes'

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Metro Manila (CNN Philippines, December 18)—Congress ratified Wednesday night the bill setting additional excise taxes on alcoholic beverages and e-cigarettes, as it goes on recess for the Christmas season.

The bill will be submitted to the President for signing into law.

The bicameral conference committee approved on Wednesday afternoon the so-called "sin tax " bill.

The reconciled version of House Bill 1026 and Senate Bill 1074 , if enacted, will raise P24.9 billion in additional revenues for the universal health care program.

According to Senate Ways and Means Committee chairperson Pia Cayetano, the new tax rates are the following:

- fermented liquor (specific tax rate): P35 in 2020, P37 in 2021, P39 in 2022, P41 in 2023, and P43 in 2024, with a 6 percent indexation thereafter.

- distilled spirits (specific tax rate with 22 percent ad valorem tax): P42 in 2020, P47 in 2021, P52 in 2022, P59 in 2023, and P66 in 2024, with a 6 percent indexation thereafter.

- sparkling and still wines (specific tax rate): P50 in 2020, with a 6 percent indexation thereafter.

- heated tobacco products (specific tax rate): P25 in 2020, P27.50 in 2021, P30 in 2022, and P32.50 in 2023, with a 5 percent indexation thereafter

- salt nicotine (specific tax rate): P37 in 2020, P42 in 2021, P47 in 2022, P52 in 2023, with a 5 percent indexation thereafter

- free base (specific tax rate): P45 in 2020, P50 in 2021, P55 in 2022, P60 in 2023, with a 5 percent indexation thereafter

Apart from raising taxes of alcohol and tobacco products, the proposed measure also aims to impose higher tariff for vapor products including electronic cigarettes.

It also imposes stricter regulations for the sale of e-cigarette.

House Ways and Means Committee chairperson Joey Salceda and Cayetano said the measure prohibits non-smokers and those below 21 years old from buying e-cigarettes.

Violators will face penalties, including jail time.

The Senate approved its version of the bill on Monday, while its counterpart measure passed the lower chamber in August. President Rodrigo Duterte certified the measure as urgent in November.

Lawmakers have previously expressed a possible “win-win situation” with the bill’s passage— as it seeks to curb vices while supporting the nationwide health program.