MANILA — At least two lawmakers have proposed to impose an excise tax on 3-in-1 coffee and flavored fermented milk, as they expressed concern over sugar content.
Bataan 1st District Rep. Antonino Roman III and Albay 1st District Rep. Krisel Lagman are suggesting a flat excise tax rate for the said products.
“I’d like to propose [that] we lift the exemptions on previously exempt sweetened products, particularly 3-in-1 coffee and flavored fermented milk,” Lagman said.
“Bakit sa inyong panukala, hindi n’yo isinama ‘yung flavored fermented milk. Pangalawa, bakit hindi isinama ‘yung 3-in-1 coffee? Noong natikman ko ‘yung 3-in-1 talagang nagising ako eh. Talagang umabot hanggang utak ‘yung tamis ng 3-in-1,” Roman asked the DOF.
“‘Yung for flavored milk, napag-alaman po namin na ginagamit po ito ng gobyerno mismo sa ating mga nutrition program. Kaya inalis muna namin ang flavored milk. ‘Yung 3-in-1 po, ginagamit po ng mahihirap,” Finance Undersecretary Karl Adriano replied.
But he said the DOF is “open” to the lawmakers’ proposal. Adriano noted that the agency’s original proposal includes lifting the tax exemption on 3-in-1 coffee and flavored fermented milk. But this changed after consultation with stakeholders.
“In the original proposal of the DOF, kasama po ‘yung removal of the (tax) exemption ng mga nasabing produkto. But upon consultation with stakeholders, ibinalik po namin ‘yung exemption. But we’re open to this proposal, and we will ultimately defer to the Department of Health in terms of the coverage,” Adriano said.
“‘Yung sa panukala namin, kung hindi ako nagkakamali, ni Cong. Krisel Lagman, ang panukala namin ay patawan ng P6 excise tax, flat rate lang, ang 3-in-1, at saka P6 ‘yung flavored milk. Sa tingin n’yo ba ‘yung ganoong halaga e talagang napaka-significant, na talagang magiging anti-poor ‘yung panukalang batas?” Roman inquired.
“Sariling opinyon ko po ito, hindi po opinyon ng DOF, 20 percent yun gusto mong increase in prices based on the WHO recommendation and I think kapag P6, hindi po ‘yun equivalent to a 20 percent increase in price,” Adriano answered.
TAX ON ICE CREAMS AND FROYOS
The DOF, for its part, proposed to increase the tax on sweetened beverages using caloric sweeteners from P6/liter to P20/liter, and those using high fructose corn syrup from P12/liter to P40/liter, with an annual indexation rate of 5 percent.
It also proposes to remove the tax exemption on natural fruit juices, vegetable juices, and on edible ices, like ice creams and frozen yogurts.
“Assuming there will be a reform by 2027, you can see a significant jump in the excise tax burden. So, for instance, I will just highlight the carbonated beverages. So 5 percent this year, it will go up to around 15 percent by 2027. And then, given the annual indexation, it will ensure that the tax burden will not be eroded by it,” Adriano said.
“Given this reform, on average, consumption will decrease by around 27.2 percent. Wherein carbonated beverage consumption will decrease by around 32 percent,” he added.