The Departments of Finance (DOF) and of Health (DOH) have launched a new ad featuring the “People’s Champ,” Senator Emmanuel “Manny” Pacquiao in a fight against the iconic Yosi Kadiri with the campaign’s tagline “Hindi pa tapos ang laban.”
Pacquaio, who is better known as “Pacman” or the “Pambansang Kamao,” is shown in the new ad as a champion of the Filipino people’s health.
DOF and DOH have revived Yosi Kadiri to help generate greater public support for, and convince legislators to pass, the bill increasing “sin” taxes on tobacco products.
There are currently three pending bills in the Senate that are separately pushing for a further increase in tobacco excise taxes from P60 to P90 per pack.
With only three working weeks left for the 17th Congress, the ad launch is part of a multi-stakeholder push to increase tobacco excise taxes to at least P60 per pack to safeguard public health and sustain funding for the Universal Health Care (UHC) Law.
Considered as one of the most successful health campaigns in the ‘90s, Yosi Kadiri was first launched by the DOH under the late former Health secretary and senator Juan Flavier. The iconic Yosi Kadiri mascot was introduced to depict the detrimental effects of cigarette smoking on the health of both smokers and non-smokers.
Apart from curbing smoking prevalence among Filipinos, especially the youth, the further increase in tobacco excise taxes aims to help sustainably fund the expanded UHC Law.
The UHC Law aims for 100 percent health service coverage for all Filipinos, which is estimated to cost P257 billion in its first year of implementation alone, in keeping with President Duterte’s commitment to attack poverty and improve living standards.
Similar to the proposal of DOH and DOF, Senate Bill (SB) No. 1599 filed by Pacquiao aims to increase tobacco excise tax to P60 per pack (regardless of brand or price) in the first year of implementation, and an additional nine percent each year thereafter. Senators Sherwin Gatchalian and JV Ejercito also proposed a higher excise tax rate of P70 per pack (SB 2177) and P90 per pack (SB 1605), respectively.
DOF and DOH are also proposing an increase in alcohol excise tax rates.
Raising excise taxes on “sin” products is still the most effective policy tool to affect alcohol and tobacco prices to discourage consumption and prevent especially the youth and the poor from smoking and binge drinking. Such tax adjustments are part of Package 2+ of the Comprehensive Tax Reform Program (CTRP).
While the House of Representatives already approved higher excise tax rates for tobacco and alcohol in December last year, these new rates were much lower than the DOF-DOH proposal. The projected revenues from the new tax rates would not be enough to sustainably fund UHC Law.
Finance Undersecretary Karl Kendrick Chua said, “The total difference (between the House-approved version and the DOF-DOH proposal) is P244 billion if computations are done up to 2022. Such a funding gap might undermine the effective implementation of the UHC.”
The DOF-DOH proposal is ideal because it would prompt “the youth, the poor and other price-sensitive cigarette users to stop smoking,” Chua said. Price-sensitive consumers are those who are likely to be discouraged by higher prices from buying certain products.
Simulations developed jointly by the DOF, DOH, and the World Health Organization (WHO) indicate that the DOF-DOH proposal on a P60-per-pack increase in the tobacco excise tax will bring down cigarette consumption by 16.8 percent and enable 3.2 million adults to quit smoking.
In his sponsorship speech on SB 1599, Pacquiao said the approval of his bill would prevent an estimated 850,000 adults from smoking on the first year alone of its implementation.
He added, “The tobacco tax increase will help raise revenues. Magkakaroon ng funding ang universal health care. Napakalaking tulong po ito para sa pangangailangan sa budget ng ating gobyerno.”
Similarly, Gatchalian and Ejercito supported the increase in tobacco excise taxes to raise the necessary revenues for quality healthcare.
“This legislation will help raise the needed revenues to sustain and enhance the proposed primary care system for Filipinos while promoting better health and healthier lifestyles,” Gatchalian previously said in a press release.
Ejercito said in an earlier statement, “Isa po talaga ito(‘sin’ tax hike) sa nakikita kong mapagkukunan ng pondo para saUHC, and at the same time, will reduce cigarette smoking in the country …. As I have been saying, this is revenue and a health measure at the same time.”
During the conclusion of the Senate’s public hearings last February 2019, Senator Sonny Angara said, “While there is no consensus yet on the final tax rate, there is an agreement in principle to increase the excise tax on tobacco products in order to raise funds for the UHC bill and substantially reduce the smoking prevalence among the youth.”
The ad can be viewed via the DOH (https://www.facebook.com/OfficialDOHgov/) and DOF (https://www.facebook.com/DOFPH) Facebook pages.
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