Source: POLITIKO.COM.PH | Monday, 03 August 2015
budoymadrona
Romblon Rep. Eleandro Madrona is urging anti-tobacco groups to support his bill mandating a minimum cigarette price (MCP) on cigarettes.
Mendoza said the MCP would stop cigarette manufacturers from coming up with cheaper brands that are more affordable to smokers, particularly the youth.
“UP professors are saying that smoking goes unabated in the country because of cheap cigarettes. Anti-tobacco groups are worried that new cheap brands by tobacco players would further lure more smokers. My answer to that is to require a minimum cigarette price,” the Romblon lawmaker said in a story published by Daily Tribune.
Madrona was referring to the study of UP professors Stella Luz Quimbo and Antonio Manuel Dans claiming that smoking did not go down post-Sin Tax increase because cheaper cigarettes proliferated in the market.
Quimbo explained that low-priced brands gave Filipino smokers the capacity to continue their unhealthy habit.
For his part, Finance Undersecretary Jeremias Paul said the introduction of cheaper cigarettes in the market and the tobacco companies’ actions to absorb part of the taxes remain a challenge for the implementation of the Sin Tax Law.
Paul stressed that keeping the prices of cigarettes affordable defeats the drive to reduce tobacco use and also raise more revenues from taxes levied on the commodity.
Under the Sin Tax Law, a single unitary tax of P30 per pack will be enforced by 2017.
But Madrona claimed that there is no guarantee that tobacco players would increase their cigarette prices in reaction to higher tax regime.
“I have supported the Sin Tax Law but raising taxes may not be always the viable option. Because even if you raise excise tax, tobacco companies would only absorb the additional tax just to continue offering cheap cigarettes,” he explained.
“Whereas, if you mandate an MCP, cigarette prices would be relatively prohibitive to youth smokers regardless of any upheaval in the excise tax rate,” he added.
Madrona stressed an MCP would serve as deterrent for tobacco players to sell their cigarettes lower than the tax rate.
Based on Madrona’s House Bill 5013, tobacco companies would be mandated to adopt an MCP per cigarette pack of P38 or not below P1.90 per stick and would be increased to P44 per pack and P51 per pack in 2016 and 2017, respectively.
The MCP per pack would increase annually by four percent effective 2018 and should be aligned with the law-mandated increases in the Sin Tax Law.
