[View the story “House of Representatives passes Sin Tax Reform Bill” on Storify]
So what is now the final House version of the proposed law?
– Simplifies the basis of excise taxation for alcohol products, which is based on per proof liter for distilled spirits, per liter of volume capacity for wines and fermented liquors;
– Simplifies the basis of excise taxation on tobacco products: cigars – per cigar; cigarettes packed by hand – per pack; and cigarettes packed by machine – per pack;
– Provides an 8-percent increase in the excise tax rates every two years effective January 1, 2015 until January 1, 2025 for distilled spirits, wines, fermented liquors, tobacco products, cigars and cigarettes through revenue regulations issued by the Secretary of Finance;
– Removes the price/brand classification freeze on alcohol and tobacco products;
– Allocates the incremental revenues from the excise tax on tobacco products for the provinces producing burley and native tobacco, in accordance with the volume of tobacco leaf production, to promote economically viable alternative programs for tobacco farmers and workers;
– Provides additional funding for the universal health care program of government.
TOBACCO/CIGAR/ CIGARETTE
MACHINE-PACKED
Effective on January 1, 2013
P11.50 and below per pack – tax rate P12
P11.50 and above per pack – tax rate P28.30
Effective on January 1, 2014
P11.50 and below per pack – P22
P11.50 and above per pack – P30
LIQUOR
DISTILLED SPIRITS (Whisky, Brandy, Rhum, Gin, Vodka)
Less than P90 net retail price (750 ml volume) – tax rate P20
Between P90 and P150 – tax rate P80
Above P150 – tax rate P320
WINES (Sparkling Wines and Champagne)
P500 and below net retail price – tax rate P250
P500 and above net retail price – tax rate P700
FERMENTED LIQUOR (Beer)
P50.60 and below net retail price – tax rate P13.75
P50.60 and above net retail price – tax rate P18.80
As BIR Commissioner Kim Henares said, the sin tax reform has a long way to go and the battle might be tougher at the Upper Chamber of Congress.