HOUSE Speaker Feliciano Belmonte Jr. on Tuesday said he would demand an oversight investigation into the reported leaks in the implementation of the “sin” tax law.
Belmonte, in a news conference, said the Congressional Oversight Body on Republic Act (RA) 10351, or “An Act Restructuring the Excise Tax on Alcohol and Tobacco Products,” also known as sin-tax law, should look into complaints against Mighty Corp., a local cigarette company, which, according to the Bureau of Internal Revenue (BIR), is liable for nonpayment of taxes.
“I have to ask the oversight committee to give me a report,” Belmonte told reporters.
Earlier, the BIR said the agency is already investigating the alleged tax evasion committed Mighty.
“It’s really a BIR affair but we have not been hearing about this,” Belmonte said, adding, “somebody has been questioning about sin tax which should really be looked into.”
In House Resolution 1591, Pwersa ng Masang Pilipino Rep. Rufus B. Rodriguez of Cagayan de Oro City and Rep. Maximo Rodriguez Jr. of Abante Mindanao are calling for a congressional inquiry into the alleged failure of the government to allocate a big part of the revenue collection from RA 10351 to finance its universal health-care program.
The lawmakers asked the lower chamber to conduct an inquiry into the matter and invite the officials of the Department of Finance, BIR and Department of Budget and Management (DBM) to shed light on the issue.
It added the law mandates the DBM, the Department of Health, Department of Agriculture and the Philippine Health Insurance Corp. to submit to the Oversight Committee of Congress a detailed report on the expenditure of the amount earmarked for the Universal Health Care Program.
Party-list Rep. Leah Paquiz of Ang Nars said Congress should determine the loopholes in RA 10351, which according to her, has not been able to raise enough funds to finance the health program of the Aquino administration.
“Foot dragging, tax evasion, not collecting the right taxes will surely hamper health programs and services,” said Paquiz, who is a member of the House Commit-
tee on Health.
Aiming to pump revenues into its universal health care and other programs that directly benefit the public, the Aquino administration signed RA 10351 in December 2012. It took effect in January 2013.
By raising the sin-tax rates, the government, by its calculation, expects to collect at least half a trillion pesos from 2013 to 2017, with the bulk of the collection coming from the tobacco industry.
Under the sin-tax reform law, tax rates on alcoholic beverages and tobacco have been raised to boost state revenues and reduce the incidence of smoking.
The increase will be implemented annually for most products until 2017, after which the tax rate will be indexed to inflation to avoid eroding government revenues.
The DOH said the law has proven to be effective in reducing tobacco consumption, saying during the first year of implementation, there was a significant decrease in smoking prevalence among adults 20 years and above, from 31 percent in 2008 to 25.4 percent in 2013.
More important, the agency said a significant decrease in smoking prevalence was also seen among children 10 to 19 old years, from 9.1 percent in 2008 to 6.8 percent in 2013, despite no significant increase in tobacco advocacy activities.
5 comments
This has been in the news for more than a year now. Does it really take that long for government to do something? Frustrating that this hasn’t been resolved already.
It takes that long if there are people trying to block proper action. It’s so frustrating that sometimes our officials themselves are the ones who try to hide these problems instead of doing their sworn duty to the country.
A BIR affair indeed! THis begs the question of why BIR is dead set on ignoring the mounting evidence against illicit cigarette trading activities of Mighty Corp?
Most of the time, the law can be bent for the rich because they’ll just have to pay it.
Makes you wonder what hold Mighty has on the BIR, doesn’t it? About time the Bureau gets called out on their bias.