House OKs 120/kilo excise tax on plastic
The House Committee on Ways and Means approved on Tuesday a bill seeking to impose 120 excise tax for every kilo of plastic used for packaging, excluding sachets.
After more than one
hour of deliberation, the House panel, chaired by Albay Rep. Joey Salceda unanimously passed House Bill No. 178, with amendments.
It was North Cotabato Rep. Jose Tejada who moved for the approval of the amended HB 178. The motion was seconded by Galing sa Puso partylist Rep. Jose Gay Padiernos.
“Now, it is not just single-use plastic bag, it’s all plastic used for packaging except for sachet,” said Nueva Ecija Rep. Estrellita Suansing who authored HB 178 with her husband Sultan Kudarat Rep. Horacio Suansing Jr. after the Salceda panel approved the amended version of their bill.
“The excise tax is increased to P20 per kilogram from 110,” she said.
HB 178 originally sought to impose 110 excise tax for every kilo of single-use plastic bag removed from the place of production or released from the customs house.
But, during the second hearing on HB 178, the Salceda panel decided to impose higher excise tax on all plastics used for packaging.
“We will tax anything that is used for packaging,” Salceda said, before passing the bill.
He explained that under the bill, the specific excise tax imposed shall “be collected upon removals from factory.”
The House leader said the proposed imposition of 110 excise tax for every kilo of plastics used for packaging would generate 14.8 billion in revenues for the government.
“This will generate 14.8 billion in revenues during the first year of implementation,” he said.
During the hearing, it was disclosed that the daily plastic consumption in the country is pegged at 96 million.
The Salceda panel also agreed to allocate 100 percent of the revenues to the Solid Waste Management Fund.
“One-hundred percent of the revenues shall be earmarked for solid waste management and implementation of Republic Act 9003 [the Ecological Solid Waste Management Act of 2000],” Salceda said.
Suansing noted that neighboring countries, including Hong Kong, Indonesia, and Cambodia impose heavy tax on single-use plastic bag per piece.
“In Hongkong, it’s 13.25. In Indonesia, it’s 118. In Malaysia, it’s 12.44 per piece and 15 in Cambodia per piece,” she noted.
She insisted that the levy on the plastic bag “should be source-based” instead of “at point of sale” as suggested by the Retailers Association, after the Department of Environment and Natural Resources (DENR) expressed apprehension that the manufacturers would produce more thin film plastics.
“The suggestion of the Retailers Association is it should be at point of sale. We are telling that it should be at source, that is why it is excise tax. The DENR is worried that manufacturers will make thinner plastics to increase the quantity per kilo. What we are going to do is we will put a thickness, and that it should not be lower than [the prescribed] thickness,” Suansing said.
DENR Undersecretary for Solid Waste Management and Local Government Units Concerns Benny Antiporda relayed to the Salceda panel that the DENR is trying to discourage the use of thin film plastics.
Benjamin Chua, who represents the 150 companies producing plastic bags in the country, opposed the tax measure.
“Unless there is better alternative to plastics, we don’t think there is a need to slap a levy on it. If ever there is a levy, we think it is discrimatory,” he said, adding that even other packaging options should be taxed.
“Plastic is not evil,” Chua stressed. Salceda assured Chua that “not a single peso of your profit will be affected because you will pass it on to the consumers.”