‘Revisit sin tax law to hike funds for health’

THE national government should revisit the sin tax law to maximize the funds allocated to the health sector, according to a study released by the state think tank Philippine Institute of Development Studies (PIDS).

In a discussion paper, PIDS research consultants Miharu Jay M. Kimwell, Frances Lois U. Ngo, Vicente Alberto R. Puyat and George Douglas D. Siton evaluated the performance of public health budget allocations arising from the earmarking policy of the Sin Tax Reform Act of 2012 (Republic Act 10351).

They said 85 percent of incremental tax revenues collected from excise tobacco and alcohol taxes are earmarked for the health sector. But, these funds “have not necessarily been efficiently and equitably utilized.”

“The DOH [Department of Health] should exhibit its capability and accountability to utilize its annual budget effectively,” they noted.

The researchers also underscored that health programs need to be more strategic in requesting, allocating and utilizing funds to address gaps in service coverage.

“Given the increase in fiscal space and autonomy to use the budget, monitoring and evaluation of the outcomes achieved by the allocations provided by sin tax revenues must be continuously reported,” they added.

The revenues fund the programs and activities of the DOH and premiums for the Philippine Health Insurance Corp.

In terms of equitable budget allocation, most of the funds from sin tax revenues are used to finance the membership of the disadvantaged sector in the national health insurance program.

Thus, PIDS said, poverty incidence must be consistently included among the criteria and administrative processes when allocating funds to projects and activities.

The authors also emphasized the need to revisit the performance indicators for different health programs and activities so that the targets can “effectively and clearly quantify” the services and outcomes toward the achievement of the universal health care and other health programs.