Business

DOF to submit comprehensive tax package that include P10/L excise tax on sugary beverages



ADVERTISEMENT

MANILA, Philippines — The Department of Finance (DOF) is looking to impose a P10 per liter excise tax on sugar-sweetened beverages as part of the Duterte administration’s government comprehensive tax reform package.

In a recent speech before the Rotary Club of Makati, the Department of Finance Secretary Carlos G. Dominguez III unveiled the proposal to impose a uniform excise on sugar-sweetened beverages, whether in both liquid or powdered form.

“In the same way that sin taxes were implemented to safeguard public health, the DOF is seeking to impose an excise tax on sugar-sweetened beverages, which would be a uniform rate of P10 per liter regardless of whether it is in liquid or powdered form,” Dominguez said in his keynote speech before the Rotary Club of Manila.

The said P10 per liter excise excise tax would be imposed on following beverage products: soft drinks, soda pop, energy drinks, as well as sweetened teas and coffees. This is in line with a bill submitted by Representatives Horacio Suansing Jr. and Estrellita Suansing.

The bill seeks to apply a P10 excise tax on sugar sweetened beverages, which will be increased by 4 percent each year by inserting a new section in the National Internal Revenue Code. That being said, the purpose of this is provide additional revenue collections for the Philippines.

An earlier draft of the Finance’s tax policy reform program proposal also revealed the plan to mulct a P5 per kilograms excise tax on sugary products, including domestic raw sugar, refined sugar as well as imported sugars and sugar substitutes, which would result in an additional revenues worth P18.1 billion.

SEE ALSO:  Sen. Bam Aquino Encourages Filipino Students In Financial Literacy In Sun Life Sinag Students Summit

The government’s comprehensive tax reform program will be submitted to the House of Congress before by the end of the month. It would have four main packages aimed for passage in the next three years: Personal income tax and consumption; corporate income tax and incentives; property tax and capital income tax.

Meanwhile, the DOF also planning to impose a fatty food tax, a carbon tax, casino and lottery tax, mining taxes as well as a luxury tax on cars, jewelry and yachts.

The consumption tax package should be passed by Congress and could collect around P109.4 billion per year in revenues for the country, according to official documents.

The first package will lower the personal income taxes for low- and middle-income earners, but higher mulcts for high earning individuals. With the tax reform package one, the compensating measures for the planned lower income tax rates are the rationalization of value-added tax (VAT) exemptions, higher excise for fuel, tobacco, alcohol, automobiles and imposition of the sugar tax.

Based on the Finance department’s estimation, the country would earn around P180.3 billion in foregone revenues from lower personal income taxes, but would generate about P471.5 billion from its comprehensive tax reform bill.

The Philippine then would expects P199.6 billion from higher fuel taxes, P166.8 billion from VAT base expansion, P48.7 billion from sugar-sweetened tax, around P45.5 billion from sin taxes, and an additional P10.9 billion from luxury excise tax that includes automobiles.

Recommended Content For You

Comments
To Top