The Philippine Association of Tobacco Based Cooperatives (PATCO) assailed BIR Regulation No. 22-2003 as "counter-productive." The tax regulation increased the tax rates of medium-blend cigarettes from P1.12 to P5.60 per pack in some brands and P8.96 to P13.44 per pack in others.
In a letter to Mrs. Arroyo, PATCO officials led by president Carlos Cachola said the affected cigarette companies are poised to cut down production by as much as 80 percent.
"This means 15 million kilos of virgina and burley tobacco will not be purchased from us in the coming tobacco season," Cachola said.
PATCO asked the President to suspend for at least two seasons the implementation of the tax regulation as they pointed out that some 45,000 farmes and their families are in danger of losing their livelihood.
Former Agriculture Secretary Leonardo Montemayor said on the eve of the 50th anniversary of the Federation of Free Farmers which he heads that farmers will suffer more than the cigarette makers from the hiked tax rates.
"That’s about one-third of the total amount of virgina and burley produce sold last season," Montemayor noted referring to the estimated 15-million kilos of tobacco that the market will fail to absorb next season.
Cachola asked that safety nets be put in place before BIRR 22-2003 is implemented. — Teddy Molina