Bill imposing increased taxes on sweetened beverages, 3-in-1 coffee eyed

Too much of anything, including sweets, can be bad for you.

Representatives Krisel Lagman of Albay, Kaka Bag-ao of Dinagat Islands and Leila de Lima of ML party-list made the position in calling for the passage of a bill increasing taxes on sweetened beverages to 20% to 40% from its current rate of 6% to 12%.

The lady lawmakers filed the measure under their House Bill 5005 which imposes a P20 tax per liter of volume capacity on sweetened beverages using purely caloric sweeteners, purely non-caloric sweeteners, or a mix of caloric and non-caloric sweeteners.

The bill also provides that a P40 tax per liter of volume capacity will be applied on sweetened beverages using purely high fructose com syrup or in combination with any caloric or non- caloric sweetener.

In addition, the bill also imposes a P6 tax per liter of volume capacity on milk, fermented milk, flavored non-dairy milk and all sweetened coffee products, including the three-in-one coffee.

The measure, however, exempts sweetened beverages using purely coconut sap sugar and purely steviol glycosides.

While the Tax Reform for Acceleration and Inclusion (Train) law imposed taxes on sweetened beverages, Lagman said the law’s gains given its present seven-year-old rates of 6% to 12% already plateaued and as a result, not enough to reduce the consumption of sugary drinks and raise sufficient government revenues.

“The Train law achieved its objective to increase revenues and reduce the sales of sugary drinks, but the Train law does not provide for indexation of the tax rate. It just remains at 6%. With our bill, we will be able to increase government revenues at a fair rate,” Lagman said in a press conference.

“We will also be expanding the scope of additional taxes. The Train law does not include 3-in-1 coffee and 3-in-1 milk, as well as fermented and other sweetened coffee productions,” Lagman added.

Finally, the bill also provides an annual additional tax of 6%.

“We estimate that this bill will generate an annual revenue of P55 billion, higher than the existing P35 billion to P38 billion a year. But more than anything, we want to emphasize that health is an investment. It should not be considered as a cost, and we know the effects of consuming too much sugar,” Lagman said.

The proceeds of the increased tax off sweetened beverages would go to:

• 40% for PhilHealth
• 10% for the Department of Health’s medical assistance and health facilities enhancement program and
• 50% for local government units’ implementation of nutrition programs.

— BM, GMA Integrated News