‘Sin’ tax collection at record P124 B

MANILA, Philippines – Excise tax collections from tobacco and alcohol continued their uptrend in November on the back of higher product volumes as companies frontloaded supplies ahead of a further hike in levies by January.

In a statement yesterday, the Bureau of Internal Revenue (BIR) said the so-called “sin” taxes went up 39.58 percent to P16.298 billion last month.

This brought the 11-month tally to P123.6 billion, up 26 percent from same period a year ago, and rising further from a fresh record set during the first 10 months.

Comparable absolute values were unavailable and could not be secured as of press time.

In a text message, Internal Revenue commissioner Kim Jacinto-Henares refused to attribute the increase in sin tax collections to higher consumption as a result of supply frontloading, which she said is a “natural phenomenon.”

“For as long as the rate keeps on increasing annually, companies will always frontload,” Henares said yesterday.

“We have always said that the increase in tax rate will compensate for the slowdown in increase in volume,” she added.

Based on BIR figures, volume of cigarettes rose 25.22 percent in November and more than a tenth for the first 11 months.

Factory supply and imports of fermented liquors and wines also increased 0.96 percent and 58.62 percent in November, respectively. They were up 1.33 percent and 33.9 percent so far this year.

Only the volume of distilled spirits and compounded liquors posted a decline in monthly and year-to-date figures, data showed. They were down 2.28 and 4.78 percent, respectively.

“Collection will continue to increase as the rates are adjusted four percent annually and of course, volume will increase (taking into consideration population growth alone),” Henares said.