Wednesday, October 24, 2012

Sin Tax Bill Gone Bad

Senator Ralph Recto received overwhelming criticisms for his 'watered down' version of the Sin Tax Bill. It’s easy to understand why.

According to the senator his version was the most realistic and pragmatic. It projects to rake in a total of 15 Billion pesos revenue for additional tax to be slapped on cigarettes and alcoholic beverage purchases.

Let's go take a step back.

The sin tax measure serves dual purpose.

First and foremost it seeks to deter a large chunk of the population (who belongs to the middle and low class) in smoking cigarettes and/or drinking alcoholic beverages and second it seeks to increase the government’s revenue.

Malacanang has been pushing for a version of the bill which would allow the government to collect at least 60 Billion pesos. Recto’s version (15 Billion projected revenue) is nowhere near that figure.

So from a profitability standpoint it fails miserably. 

In reality, the Philippine government spends around 177 Billion pesos for healthcare expenses related to smoking diseases. If you think about it, the revenue to be generated from this bill would not even cover half of the cost of hospitalization and health services spent annually by the government.

It should also be noted that the lower and middle class accounts for 90% of all the smoking and alcohol-related ailments in this country.  The very same segment of the population which is incapable of availing decent medical services.

By making the additional tax conservative or as Recto puts it, ‘realistic’, the bill defeats the principle of it being a deterrent for the continuous and lavish consumption of sin products. 

Why would a smoker stop his habit if it would only cost him a few more bucks to continue it?

If its any consolation, Recto resigned as the Committee Chair and asked that his version of the bill be put to trash. Class act.

And Senator Sotto was like, ‘What the hell buddy! Why resign? Ever heard of the cyber-libel?’

To which Recto replied: ‘Umm, it got a TRO from the Supreme Court remember? Also I don’t think I am as thick-skinned! I also don’t have a noontime variety show to defend me or wash up my image’

‘But you have no less than the Star For All Seasons as a wife! When election day comes the public would forget what this was all about! Think about the number of smokers in this country that would support you and vote for you! For all you know, you could win by a landslide!’, said the brilliant senator-clown.

'Pero yung totoo, na-influence ka ba ng cigar companies?' , usyoso ni Sotto

'Eto na lang, na-influence ka ba ni Kennedy dun sa last speech mo? Yung tinagalog mo?', sagot ni Recto na halatang inis. 

To which Sotto blurted: 'Sabi ko nga! Hindi na ako magtatanong!'

In a separate and unrelated event Pedro Calungsod became the Philippines’ second saint ordained by the Vatican. Manny Pacquiao was hoping he could snatch the third slot. 

Jinky Pacquiao is running for a vice gubernatorial post. If ignorance, arrogance and stupidity is a sin then she and her husband should be heavily taxed! 

Problem solved. 

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