The Finance Department plans to impose a fixed tax of P10 per liter on all sugar-sweetened beverage regardless of form.
Finance Secretary Carlos Dominguez III said the government under the tax reform package to be submitted to Congress expected to book P18.1 billion in additional revenues from the so-called “sugar tax.”
Dominguez said in a speech the government wanted to package the sugar tax as a health measure similar to the sin tax law.
Dominguez said Finance wanted to impose an excise tax on sugar-sweetened beverages at a uniform rate of P10 per liter whether in liquid or powdered form.
The tax aims to cover soft drinks, soda pop, energy drinks and sweetened teas and coffees.
“When all these reform measures are undertaken, we expect a net revenue gain that will help finance inclusive growth,” Dominguez said.
House Bill No. 292 filed by Sultan Kudarat 2nd District Rep. Horacio Suansing and Nueva Ecija Rep. Estrellita Suansing seeks to impose an excise tax of P10 on sugar sweetened beverages.
The bill also seeks to increase the rate by 4 percent every years from January 2017.
The bill proposes to allocate 50 percent of the revenues to the general fund, 20 percent to the Health Department, 20 percent to the Education Department, 3 percent to the Department of Interior and Local government’s Sagana at Ligtas na Tubig sa Lahat program and 2 percent to the Bureau of Internal Revenue for tax administration.
The Duterte administration plans to pass the sugar tax along with the adjustment of excise tax on fuel products to offset losses from the reduction of the personal income tax rates.
Finance Undersecretary Karl Chua said the proposal for the tax entire package that includes the reduction in the personal income and the expansion in the value added tax base aimed balance the fiscal position.