Solons okay bill raising taxes on alcohol, e-cig

MANILA -- The House of Representatives on Tuesday approved on third and final reading the proposed bill increasing the excise tax rates on liquor and heated tobacco and vapor products.

House Bill 1026 was approved with 184 affirmative votes, two in the negative and one abstention, making it the first bill to be approved by the House in the 18th Congress.

The bill specifically proposes to increase the excise tax on alcohol products and the indexation rate to 10 percent.

Under the measure, the current ad valorem tax imposed on distilled spirits will increase from the current 20 percent under the National Internal Revenue Code to 22 percent, while the specific tax will increase from PHP24.33 to PHP35 per proof liter starting on Jan. 1, 2020.

A PHP5-increase in the specific tax will then be imposed every year thereafter until it reaches PHP45 per liter in 2022.

From 2023 onwards, the specific tax for distilled spirits will climb 7 percent each year.

Meanwhile, HB 1026 will impose taxes on heated tobacco products and vapor products.

For heated tobacco

products, a tax of PHP45 per pack of 20 units or lesser will be imposed by Jan. 1, 2020, which will be increased by PHP5 every year thereafter until 2023. The tax will then be increased by 5 percent every year starting Jan. 1, 2024. For vapor products, a tax of PHP35 per milliliter of nicotine salt, or a fraction thereof, will be imposed by Jan. 1, 2020, to be increased by PHP5 every year until 2023. The tax will increase by 5 percent every year thereafter. Conventional “freebase” or “classic nicotine” will be imposed with a tax of PHP4.50 per milliliter or a fraction thereof by Jan. 1, 2020, which will be increased by PHP0.50 every year until 2023. The tax will increase by 5 percent every year starting Jan. 1, 2024. The bill was among the priority legislative measures specified by President Duterte during his Fourth State of the Nation Address last July. (PNA)