Sen. Recto doubts P40-B sin tax measure, warns of job cuts

Sen. Ralph Recto on Wednesday raised doubts that government can collect P40 billion to P45 billion in additional revenues from sin taxes and warned of significant job losses.   "Tingin ko ‘di makokolekta, masyadong mataas," Recto, who was earlier forced to resign as chair of the Senate ways and means committee, said in an interview with reporters on Wednesday.   His statement came after Sen. Franklin Drilon, who replaced Recto as ways and means committee chair, introduced a substitute bill on Tuesday which intends to raise government revenues from tobacco and alcohol products to P40 billion to P45 billion or three times more than what Recto endorsed in a committee report.   Recto’s version would yield at least P15 billion in additional revenues, or half of the P31.35 billion revenue indicated in the version approved by the House of Representatives, and a fourth of the Finance Department’s P60-billion target from the sin tax bill.   The bill Recto endorsed was peppered with criticisms and accusations – of favoring the tobacco industry – by fellow senators, the Aquino administration, health advocates and members of civil groups, which cost him the ways and means committee chairmanship. 'A big problem'   On Wednesday, he claimed that if government adds P45 billion in taxes, the tobacco and alcohol industry would need to sell P255 billion in products. "How do you collect that with fewer packs and fewer bottles? I see that as a big problem," he said.   Recto jobs would be lost because of the P40-billion target. "There would be job losses and I think it would be significant" as a consequence of the “multiplier effect, he said.   However, the senator from Batangas – which hosts a Philip Morris cigarette factory –  said he would be able to cite concrete numbers only next week.   "Alcohol comes from sugar so sugar farmers would be affected, like tobacco farmers. May manufacturing jobs in between. Retailers and sari-sari stores. In between that are logistic providers – distributors and dealers," he said.   "In alcohol industry or example, for every 1 percent increase in price, there is a reduction in volume of 1 percent…   “Ibig sabihin kapag tumaas ang presyo ng beer… sa 30 percent, bababa ang volume by 30 percent. So, 30 percent of employees mawawalan ng trabaho. Paano yung distributor and dealership? Eh, ‘di 30 percent din yan… Very textured ito, kinakailangan pinag-a-aralan at hindi padalos-dalos," he added.   Recto, however, had not doubt the sin tax bill would be passed, saying the only problem was the excise tax rates.   "Ang pinag-aawayan lang naman gaano kataas ang rate... Ano ba ang responsible and realistic? Payag naman akong itaas yan... Payag namang akong mabawasan ang naninigarilyo, manginginom. Tinaas din naman ng version ko ang rate," he claimed.   "Kung reasonable lang ang pagtaas, may mag-babawas ng inom at sigarilyo at walang mawawalan ng trabaho, makokolekta pa ng gobyerno ang gustong makolekta at meron pang pondong pangkalusugan, Recto said.   With a reasonable rate, manufacturers and industry players are protected foreign manufacturers are not subsidized, he added. — VS, GMA News