Palace says sin tax to help economic recovery effort
By MIA GONZALEZ
and JODEAL CADACIO
TODAY Senior Reporters
Malacañang said on Tuesday that the law increasing the excise tax on tobacco and alcohol will help lay the foundation for a “good takeoff” for economic recovery next year.
Press Secretary Ignacio Bunye described Republic Act 9334, which President Arroyo signed on Monday night, as a “turning point” that “provides the momentum for the executive-legislative partnership to move forward on vital revenue measures.”
“Growth is steady and will be sustained by the unremitting implementation of the President’s 10-point agenda, combined with a relentless campaign to fight graft, cut waste in government and bring in investments to create jobs. The political and economic foundations of a good takeoff in 2005 have been laid,” Bunye said.
The measure is expected to generate P15 billion, a big contribution to the estimated P80-billion revenue that the government hopes to raise from its proposed new tax measures.
With the enactment of the Sin-Tax Law, the challenge is now for Malacañang and the revenue-collecting agencies to do their part in solving the country’s lingering money problems, the chairman of the House Committee on Ways and Means said on Tuesday.
Nationalist People’s Coalition Rep. Jesli Lapus of Tarlac said the bigger task of the executive department now is to do justice to the new measure and ensure proper tax administration.
Lapus said in a statement that the bill’s timely passage demonstrated Congress’ resolve to heed the challenge of addressing the fiscal crisis.
“The measure is the first of four tax measures completed by the House of Representatives, a feat that international credit-rating agencies should appreciate,” Lapus said.
He said the P15-billion incremental revenue from the so-called sin products is higher than what these rating agencies had expected. By the New Year, the proposal to increase the value-added tax, which would bring in at least P30 billion in fresh revenues, will be set in place.
For his part, Lakas Rep. Exequiel Javier of Antique, the panel’s vice chairman, said the enactment of the new Sin-Tax Law showed the government’s seriousness in reforming the tax system in an effort to rein in the ballooning budget deficit.
TODAY