Victory in the Philippines: President Signs Historic Cigarette Tax Increase
December 21, 2012
Taking historic action to reduce smoking in the Philippines, President Benigno Aquino has signed a new law that will significantly increase cigarette taxes.
This new law will help reduce tobacco’s deadly toll in the Philippines, where 28 percent of the population smokes – including nearly half of all men – and more than 35,000 Filipinos die each year from tobacco-related disease. We applaud President Aquino and lawmakers who supported the law for taking such strong action to reduce tobacco use.
Increasing the price of cigarettes is one of the most effective ways to reduce smoking, especially among vulnerable populations such as youth and low-income smokers.
“Higher tobacco taxes will save lives,” the World Health Organization told Bloomberg News. “Tax increases that raise the price of tobacco products are the most powerful policy tool to reduce tobacco use and the single most effective intervention.”
The cigarette tax was increased along with the alcohol tax to help fund universal health insurance and other health care initiatives. Some revenues will also be used to help tobacco farmers develop alternative livelihoods.
The new law will significantly increase cigarette taxes. For example, the tax rate for low-priced cigarettes will increase from the present 2.72 pesos per pack to 12 pesos in 2013 and to 30 pesos in 2017. Ensuring that taxes keep up with inflation, the law mandates a four percent annual cigarette tax increase beginning in 2018.
The new law marks a landmark victory for the Philippines over the strong opposition of the tobacco industry. “The tobacco companies blocked this for decades and they have invested unimaginable resources to leave this cold in the halls of Congress,” stated the Framework Convention Alliance-Philippines, which advocated for the cigarette tax increase.
“Many thought it was impossible to pass the sin tax,” President Aquino said. “The enemy was strong, noisy, organized. Those who were against it had deep pockets.”
The Philippines has taken a great step forward in its fight against tobacco. The new tax law will significantly raise the price of tobacco products, reduce smoking and save lives.