A sweet life no more for soft drink junkies

PROPOSED EXCISE TAX ON SUGAR-SWEETENED DRINKS

GROWING UP, Judah dela Cruz’s mom would send him to the nearest sari-sari store every now and then where he could buy a liter of soft drink for P20 to P27.

But with the proposed excise tax on sweetened beverages, this could shoot up to P37 per liter, according to the Philippine Association of Stores and Carinderia Owners, Inc. (Pasco).

The proposal would slap a P10-a-liter excise tax on sugar-sweetened drinks, a measure which the House ways and means committee has included in its revised substitute bill containing the first package of the Duterte administration’s comprehensive tax reform program.

Aside from soft drinks, the excise tax was also seen to increase the prices of three-in-coffee from P5 per sachet to P8 per sachet and powdered juices from P9 per one-liter sachet to P20 per one-liter sachet, Pasco said.

The move, authored by Nueva Ecija Rep. Estrellita Suansing, has gained support from the Department of Health (DOH) and National Economic and Development Authority (Neda) as it will not only generate additional revenues but also make Filipinos healthier, the Department of Finance (DOF) said.

Finance Undersecretary Kendrick Chua, in earlier reports, said the proposed measure “should be viewed mainly as a health measure that is meant to discourage the consumption of high-sugar beverages, while encouraging industry players to develop healthier alternatives.”

For Dela Cruz, a 23-year-old graphic designer from Cebu City, wanting to stem illness related to unhealthy diets is admirable.

“But if the government really wants to address Filipino health problems, then they should pass affordable universal healthcare, especially for the poor,” he said in a Facebook post.

He said that many people are predisposed to diabetes even without sugar-filled diets, adding that even starch that is converted to sugar in the body can put them in danger.

“Of what use would this tax be if even simple medical procedures cost enough to completely ruin the average workers’ finances?” he posited.

Dela Cruz shares the same sentiment with 23-year-old IELTS (International English Language Testing System) training specialist Althea Ramos, who said that while the government might have good intentions with the proposed bill, it might not yield the results they hope for.

“People will still buy sweetened drinks because they won’t have many options left. Because sugar is an ingredient that is almost always present in beverages today, it is not very common to find a wide variety of drinks sans sugar. While there are sugar-free drinks for sale, these drinks are sometimes more expensive than the drinks with natural sugar,” she told Cebu Daily News.

In her case, she said she does not have problems with the excise tax on soft drinks, mainly because she hasn’t been drinking soda in the last five years. But what concerns her is how this will affect milk for children.

Ramos said it is already hard enough for most parents to buy milk for their children, how much more with the proposed excise tax.

“As for coffee, the excise tax won’t stop me from drinking it. Perhaps I’ll start taking my coffee black. Or add in the sugar myself,” she said.

The proposed measure also has Liza Tesaluna, a 42-year-old sari-sari store manager from Lapu-Lapu City, worried.

Tesaluna said their business will be affected because most of their customers are those who earn below minimum wage.

“They will find it difficult to afford the products that are affected by the tax and so, our business will also be affected,” she said in a text message.
She said sugary drinks sell fast, but because bigger supermarkets have opened in the vicinity, not so many buy from their sari-sari store nowadays compared to the time when they did not have that many competitors.

Robert Go, president of the Philippine Retailers Association (PRA) in Cebu, said the proposed excise tax on sugary drinks will affect many sari-sari stores since the measure will tremendously increase the prices of these products.

“Most of the affected items are sold by sari-sari stores and even small groceries in rural areas and mountain barangays. Supermarket-based convenience stores are also included, but that is only a small fraction of what big supermarkets sell,” he said.

Go said the proposal will also affect manufacturers as this could translate to a drop in sales.

The PRA Cebu president said he hoped the proposal can still be lowered so as not to “dig too deep into the pockets of poor people who are big fans of these products.”

Based on the DOF’s preliminary estimates, if the House-approved substitute bill would be implemented next year, additional revenues could reach only P16.8 billion. But the complementary measures that would slap tax on sugar-sweetened drinks, among others, would raise the revenue take to P82.7 billion.