On Sin Tax

LAST Thursday, the Senate started to tackle House Bill 5727 (also known as sin tax bill) which is an act restructuring the excise tax on alcohol and tobacco. This bill aims to increase taxes on alcohol and tobacco products to be used for health care services.

In our country, drinking and smoking have become the opium of the masses. These legal vices have been acceptable ways to socialize and unwind after a week's work or for some after a day's work. Raising taxes on alcohol and tobacco products would surely have a direct effect on their retail prices.


On the onset, it may seem unfair for an ordinary man who smokes and/or drinks. If the said bill is in-acted, it will significantly affect the pockets of people whose forms of recreation are limited to smoking and/or drinking. Pobre na gani ta, mao ra gani ni atong kalipay, hilabtan pa gyud?

Yet there are three main reasons why an increase tax is called for.

First is that alcohol and tobacco are bad for the health, or at least too much of them. The increase in price of such would be an effective deterrent for possible abuse of those substances. Any person will now have second thoughts of buying them thereby curbing the possible development of a vice. It should also be stressed that tobacco and alcohol are luxury products. The scarcity of such does not significantly limit a person's pursuit to happiness. Daghan pa paagi nga maayu para kita maka relax ug malipay.Get into sports.

Second is that alcohol in particular is one of the main causes of premature deaths among young adults. A significant percent of fatal road accidents are caused by at least one party driving under the influence. Not to mention the cost of emergency services of alcohol related accidents, which consumes most of the budget in emergency rooms of government owned hospitals. The increase of excise tax would somehow pay the social cost of alcohol. Barato ra ang pag palit nato sa mga ilimnon, pero mas dako ang gaka gasto sa gobyerno sa ato kung kita gakadisgrasya tungod niini.

Third is that the government really needs to improve its health care services especially in rural areas. For this to happen, it has to create a revenue mechanism to defray the cost of such improvement. What better yet to cover for health care services other than the products that put people's health at risk. Come to think of it, one of the reasons why European countries can provide free health care services to their people is because they put so much tax on alcohol and tobacco. Perhaps, it's about time that we learn from them.

Sin tax is "kill joy." That is pretty obvious. But it's kill joy that really makes sense, provided that its revenue will really translate into better health care services for Filipinos and not just into the pockets of some corrupt politicians for their expensive wines and tobacco.

Published in the Sun.Star Cagayan de Oro newspaper on August 18, 2012.