THE SENATE resumed session no less than a week after the polls closed for the May 13, 2019 midterm elections. For our part, we had just endured many months of a fulfilling but nevertheless grueling reelection campaign. It would’ve been nice to take a few more days off at that point, in all honesty.
However, the resumption of session came with the imperative for the Senate Committee on Ways and Means, which I chair, to report out, sponsor, interpellate, amend and ultimately pass a proposed measure to raise excise taxes on tobacco products.
Thankfully, in a span of just three weeks, Congress was able to fast-track the measure’s passage. We would not have been able to achieve what we did without the help of our colleagues and staff, as well as the contributions of the various government agencies, stakeholder groups and people’s organizations.
Ultimately, Congress moved quickly because President Duterte certified the measure as urgent. More importantly, funding needed to be secured for the implementation of the Universal Healthcare (UHC) Act, which we co-authored and was enacted a few months before. The extra revenues from the higher excise taxes were identified as the main source.
Once the measure is signed into law, excise taxes on cigarettes will be raised to P45 per pack in 2020 until it reaches P60 in 2023. Afterwards, the rates will be indexed — or raised — by five percent every year.
The measure also expanded the scope of the excise to include heated tobacco products or HTPs (known by different names depending on the brand) and vapor products (colloquially referred to as “vape juice”). Starting January 1, 2020, HTPs will be taxed P10 per pack of 20 units, while vape juice will be levied P10 for 10 milliliters.
Based on the projections of the Department of Finance (DOF), the new excise taxes could raise up to P130 billion in incremental revenues in the first five years of implementation. Such amount will greatly aid the government’s efforts to achieve true universal healthcare coverage envisioned not just in the recently enacted UHC Act (RA 112233), but also by my father, the late Senate President Edgardo J. Angara, when he authored the National Health Insurance Program Act (RA 7875) which created PhilHealth.
All these explain why it felt like a real blow in the gut when an investigative report broke out tackling allegations of fraud and corruption perpetrated by some hospitals, health centers and PhilHealth. The report centered around a dialysis clinic in Novaliches, Quezon City allegedly making fraudulent claims to PhilHealth for deceased patients or for patients who did not complete their weekly dialysis sessions.
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