Senate looking for a ‘sweet spot’ between P15-P40B as final sin tax version, says Angara
Senator Edgardo Angara on Monday said that the Senate is looking for a sweet spot between P15 to P40 billion starting at (Sen. Ralph) Recto report on Sin Tax bill to satisfy the health concerns and expectations on revenues.
“We’ve got to strike at the sweet spot that will satisfy the health and expectations. At the same time not destroy the livelihood of our colleagues from the North,” Angara said.
“We start with the committee report of Ralph Recto which is P15 billion and from there we move on. But it’s more than the ultimate figure. The question is not just whether it’s 40, 50, 15. I think we ought to look at the allocation of burden,” he added.
Angara also said that the Senate should pass the sin tax bill simultaneously with the national expenditure since the projected revenues on the measure is factored in the 2013 budget.
“Starting with Recto report is more likely and it has to be in time for budget approval since the proceeds from sin tax already factored in expenditure projections so this is time bound,” Angara said.
He said, the Senate’s deliberation on the bill will start with lower range at P15 billion contained in Recto report because, as the resigned ways and means chairman said, the P60 billion projections is unrealistic.
“We start with lower range that is P15-B as contained in Recto report. So the range could very well be between P15B and P40B. We’ll have to pick the sweet spot in between,” Angara said.
Ask where the sweet spot lies, Angara said now the target range is between P30 to P40 billion because P60 billion is more than the combined profit for three years of the industry.
“You will in effect destroy the industry by overtaxing them,” he said.
He added that the Senate should rest the incidence of taxation in equitable manner but careful enough not to indiscriminately taxing foreign brands because it will go against the World Trade Organization (WTO).
“It has to be equitable between cigarette and liquor. The other issue is within the same category like liquor, we ought to be careful about taxing indiscriminately foreign brands because we go against the WTO,” he explained.