Diokno eyes imposing tax on pollutants

FINANCE Secretary Benjamin E. Diokno backed the imposition of taxes on carbon emissions and single-use plastics, a move proposed by the Duterte administration in its fiscal consolidation plan to help the government raise revenues.

Diokno said the implementation of tax measures is one step that the government can take to reduce pollution, noting that the Philippines is one of the countries that are most vulnerable to the effects of climate change.

“It’s in our own interest that the movement towards climate change should be supported,” Diokno said in a televised interview last Wednesday. “At the same time, I think, on our part, on the tax side, I think we should think of some measures that we can do to reduce pollution, for example, tax on single-use plastic is worth considering.”

Apart from taxing single-use plastics, Diokno separately told finance reporters that he is also in favor of taxing carbon emissions to combat climate change.

“Carbon tax too, if feasible,” Diokno said in message. The Finance chief, however, didn’t elaborate.

Along with imposing tax measures, Diokno said during the television interview that the national government and local government units should work together and embark on cleaning the river, replanting of trees, and developing mangroves, among others.

ADB funding

TO help the country outgrow its debt, the Department of Finance under Diokno’s predecessor, Carlos

G. Dominguez III, proposed that the next administration impose new taxes, improve tax administration and cut unnecessary spending with fiscal reforms. Under the proposed fiscal consolidation and resource mobilization plan submitted by the Duterte administration to the Marcos administration, the imposition of a P20-excise tax per kilogram of single-use plastic bag by 2023 is estimated to generate annual revenues of P1 billion.

Meanwhile, the imposition of tax on carbon emissions was earlier proposed to be implemented by 2025 as the proper carbon tax structure is still under study. Given this, the Duterte administration has not disclosed any estimated revenue impact for the said proposal.

Nonetheless, imposing carbon taxes is supported by the Manilabased multilateral lender Asian Development

Bank (ADB). The ADB said these are among the sustainable financing options of Southeast Asian governments to enable them to fund climate-friendly infrastructure investments and leverage green growth opportunities.

In its report, titled, “Implementing a Green Recovery in Southeast Asia,” ADB said investing in green recovery is crucial for the region as this will help it recover from the pandemic and make Southeast Asian economies resilient in the face of shocks.

As its Nationally Determined Contribution (NDC) to the Paris Agreement, the Philippines has committed to a greenhouse gas emission reduction and avoidance of 75 percent from 2020 to 2030 for the sectors of agriculture, wastes, industry, transport, and energy despite being among the countries with the smallest carbon footprints.