Link to DOF microsite/presentation: ... · PhilHealth claims due to alcohol is PHP 68 million per year. At 42 percent support value of PhilHealth, actual hospital cost is around PHP

DRAFT FOR DISCUSSION. SUBJECT TO CHANGE.

Link to DOF microsite/presentation:

http://taxreform.dof.gov.ph/

publication/recent-presentations/

1

http://taxreform.dof.gov.ph/publication/recent-presentations/



Package 2+Alcohol excise tax reform

As of 20 August 2019


Policy objectives

1. Attain better health outcomes

a. Achieve 10 percent reduction in harmful alcohol consumption by 2025

b. Reduce related diseases and hazards

2. Raise revenues for Universal Health Care

a. Sustain 100 percent PhilHealth coverage

b. Provide outpatient check-ups and medications

4


Ten reasons why we need to raise alcohol excise tax

5


Top 10 reasons why we need to raise alcohol excise tax

1. To finance the funding gap of the UHC;2. To reduce alcohol-related deaths from sickness;3. To reduce harmful effects of alcohol on health;4. To reduce the healthcare cost, especially for poor Filipinos;5. To reduce fatal injury and sudden deaths from alcohol consumption;6. To reduce the high prevalence of alcohol consumption, especially binge drinking;7. To protect the youth from marketing strategies that induce them to consume

more alcohol;8. To discourage consumption of unhealthy products;9. To reduce the economic cost of alcohol; and10. To rebalance the revenue sharing from 70:30 to 60:40 for tobacco and alcohol,

respectively.6


Funding gap before the enactment of the increase in tobacco taxes (RA 11346)

7

1. To finance the funding gap of the Universal Health Care (UHC).


Totals may not add up due to rounding.

Funding gap after the enactment of the RA 11346 and HB 1026 as amended



10

UHC benefits for all Filipinos

These are some of the specific benefits that Filipinos will receive under UHC if fully implemented.



13

4.7 7.2 8.7 10.3

11.4 12.6 14.2 15.2 17.2

19.7

2.6 4.7 5.1

7.0 9.7

12.1

15.8

22.1

33.8

67.7

0

10

20

30

40

50

60

70

1st 2nd 3rd 4th 5th 6th 7th 8th 9th 10th

PH

P b

illio

ns

Decile

Unhealthy products spending (alcohol, tobacco and sweetened beverages) Medical care spendingSource: PSA, FIES 2015

The poor spend more on unhealthyproducts than on healthcare.



2. To reduce alcohol-related deaths from sickness.

Sources: Global Burden of Disease Study, 2017; DOH

31

25

15

31

25

17

32

26

18

32

27

19

-

5

10

15

20

25

30

35

No reform HOR DOH-DOF

Tho

usa

nd

dea

ths

Year 1 Year 2 Year 3 Year 4

15,098 deaths can be avertedfrom harmful use of alcohol

on year 1 with DOH-DOF

44


Worldwide, harmful use of alcohol causes:

26 percent of all mouth cancer cases11 percent of all colorectal cancer cases5 percent of all breast cancer cases7 percent of all hypertensive heart disease48 percent of all liver cirrhosis cases 26 percent of pancreatitis cases20 percent of all tuberculosis cases

Source: World Health Organization (WHO), 2018


46


Alcohol accounts for5 percent of the Philippines’ years of human life lost to illness, disability, and premature death.

(GBD 2010 data from Institute for Health Metrics and Evaluation)


47


Alcohol, like tobacco, causes deaths in all age groups.

However, young people are disproportionately susceptible to risk of death from alcohol (IHME 2018).

2. To reduce alcohol-related deaths from sickness.The youth die from alcohol far more than from tobacco

48

DRAFT FOR DISCUSSION. SUBJECT TO CHANGE.Brain1. Stroke, seizures, coma and

death2. Addiction and withdrawal3. Brain shrinkage4. Learning and memory loss5. Loss of coordination6. Anxiety, depression and

personality disorders

Lungs

1. Lung infection like tuberculosis and pneumonia

2. Breathing may stop, then death

Liver

1. Cirrhosis2. Fibrosis3. Alcoholic hepatitis4. Liver failure5. Fatty liver

Pancreas1. Chronic

pancreatitis

Intestines1. Cancer2. Ulcer3. Abdominal pain,

nausea, vomiting and diarrhea

4. Inflammation, irritation and hemorrhaging

Eyes1. Blurred vision

Stomach1. Peptic ulcers2. Irritated lining and

bleeding lesions

Heart1. Cardiomyopathy

(weakens heart and muscle to pump)

2. Enlarged heart3. Irregular heart beat4. High blood pressure

Throat1. Cancer2. Irritation, bleeding

and difficulty of swallowing

Mouth1. Risk of cancer2. Slurred speech

Reproductive system1. Impotence in men2. Infertility, early

menopause and menstrual irregularity in women

Bones1. Early onset of

osteoporosis

Muscles1. Weak and soft

muscles

3. To reduce harmful effects of alcohol on health.

33 major disease categories


4. To reduce the healthcare cost,especially for poor Filipinos.

Liver cancer drugs PHP million per treatment

Pembrolizumab 3.2

Regorafenib 2.7

Sorafenib 1.6

Source: DOH

Liver transplants PHP million per treatment

National Kidney and Transplant Institute (NKTI)

1.5 to 2.5

Private hospitals 3 to 4

51


PhilHealth claims due to alcohol is PHP 68 million per year.

At 42 percent support value of PhilHealth, actual hospital cost is around PHP 162 million.

This means out-of-pocket cost of sick people can reach PHP 94 million, an amount the poor cannot afford.Source: PhilHealth


53


Alcohol consumption is also widely considered as risk factor for intimate partner violence and sexually transmitted infections (National Institute on Drug Abuse 2015).

Sexually transmitted infections [STIs] include HIV, which are already at epidemic rate in the Philippines (DOH 2016).


55


5. To reduce fatal injury and sudden deaths from alcohol consumption.

Source: Department of Health Online National Electronic Injury Surveillance System

Particulars 2016 2017 2018 Total

Road accidents (fatal and non-fatal)

2,562 4,599 3,211 10,372

Injuries incurred from violence in relation to alcohol intake

1,408 1,560 535 3,503

Injury cases from drowning while in the influence of alcohol

5 9 4 18

56


Socio-economic costs of road accidents

PHP 5.9 million is lost per fatal road accident, of

which:

1. PHP 4.3 million (73 percent) is lost labor output;

2. PHP 861,395 (15 percent) is social cost of pain,

grief, and suffering;

3. PHP 431,024 (8 percent) is medical cost;

4. PHP 305,968 (5 percent) is funeral, property

damage, and administration costs.

Adjusted for inflationSource: De Leon, Mark Richmund M., Primitivo C. Cal and Ricardo G. Sigua. 2005. “Estimation of socio-economic cost of road accidents in Metro Manila.” Journal of the Eastern Asia Society for Transportation Studies, vol. 6, pp. 3183 – 3198


Up to PHP 19.0 billion in social cost.

58


More women experience physical violence from husbands who consume alcohol.

Source: Department of Health, 2019

Husband's alcohol consumptionNumber of women

2008 2013 2017

Does not drink 1,504 1,678 4,098

Drinks 4,859 4,953 6,705

Gets drunk very often 546 528 754


59


6. To reduce the high prevalence of alcohol consumption…

RA 8424 RA 9334Global

Financial Crisis

RA 10351

60

RA 10963

8.2 8.510.8

15.7

19.8

24.5

30.6

53.0

26.9

48.2

44.9

46.7

0

10

20

30

40

50

60

0

5

10

15

20

25

30

1998 2003 2008 2013 2015 2018

Perc

ent

PH

P

Effective tax rate Drinking prevalence

Sources: Effective tax rate data from the Department of Finance; and drinking prevalence data from Food and Nutrition Research Institute


6. …as well as binge drinking among adults.

56.2 54.9 55.760.8

58.5

64.4

37.841.1

31.0

0

25

50

75

2013 2015 2018*

Perc

ent

Prevalence of binge drinking amongcurrent adult drinkers aged 20-59 years old

All Male Female

Source: FNRI Clinical and Health Survey - 2008, 2015, 2018**Based on preliminary reports, no official report released yet**Standard drink generally has a net alcohol content of 10 grams of ethanol (depending on the country or site).

61


6. …and among the poorest current adult drinkers.

62

54.2 54.3

60.653.2

49 48.4

0

10

20

30

40

50

60

70

2013 2015 2018

Perc

ent

Prevalence of binge drinking among poorest andrichest current adult drinkers aged 20-59 years old

Poorest RichestNote: The poorest and richest belong to the first and fifth quintile, respectively.Source: FNRI Clinical and Health Survey - 2008, 2015, 2018**Based on preliminary reports, no official report released yet**Standard drink generally has a net alcohol content of 10 grams of ethanol (depending on the country or site).


Note: The poorest belong to the first wealth quintile.Source: FNRI Clinical and Health Survey - 2008, 2015, 2018**Based on preliminary reports, no official report released yet**Standard drink generally has a net alcohol content of 10 grams of ethanol (depending on the country or site).

6. …and among the poorest current adult drinkers.

63

46.4

38.7

40.3

34

36

38

40

42

44

46

48

2013 2015 2018

Perc

ent

Prevalence of current drinkers amongpoorest adults aged 20-59 years old

54.2 54.3

60.6

50

52

54

56

58

60

62

2013 2015 2018

Perc

ent

Prevalence of binge drinking among poorest current adult drinkers

aged 20-59 years old


7. To protect the youth from marketing strategies that induces them to consume more alcohol.

Some supermarkets even display alcopops next to regular fruit juices.

Taken on July 24, 2019 around 12nn at Puregold, San Andres, Manila

65

Taken on August 17, 2019 around 7:30 pm at Robinson’s Manila



Enticing packaging to the youth (with straw!)66

Retrieved at Gaz Cocktail’s Instagram page (www.instagram.com/gazcocktail) on 17 August 2019 at 8:30 pm.



67

Packaging is intended to mislead consumers.

Retrieved at Gaz Cocktail’s Instagram page (www.instagram.com/gazcocktail) on 17 August 2019 at 8:30 pm.


Alcohol by volume (ABV): 5 percentSuggested Retail Price: PHP 34.00Content: 320 mL

Alcohol by volume (ABV): 7 percentSuggested Retail Price: PHP 25.00Content: 200 mL

…and also more affordable than a bottle of beer.

70


Price promotions, sponsorships, online competitions,including company websites, social networking sites, and Youtube

72

7. To protect the youth from marketing strategiesthat induce them to consume more alcohol.

Source: Gaz Cocktail’s Instagram page


Source: Bureau of Internal Revenue

Increasing alcohol consumption indicates thatthere is room for further excise tax increases.

4

11 13 14 14 16 17

287

371 416 398 408

441 458

2012 2013 2014 2015 2016 2017 2018

Collection (PHP billion)

Removals (Million proof liters)

19 22 25 28 35

43 50

1.6 1.4 1.4 1.4

1.6 1.8

2.0

2012 2013 2014 2015 2016 2017 2018

Collection (PHP billion)

Removals (Billion liters)

26 34 39

53 48 63

73

1.2 1.1 1.2

1.6 1.4

1.8 2.0

2012 2013 2014 2015 2016 2017 2018

Collection (PHP million)

Removals (Million gauge liters)

Distilled spiritsFermented liquors Wines

34 29 27

58

30

69

1.2 1.0

0.8

1.6

0.9

1.8

2013 2014 2015 2016 2017 2018

Collection (PHP million)

Removals (Million proof liters)

Alcopops

8. To discourage consumption of unhealthy products.

73


83.3 83.5 84.4 83.5 80.5 79.2 82.3 83.5 83.5 78.465.8 64.4 65.9 69.1 70.5 71.6

16.7 16.5 15.6 16.5 19.4 20.7 17.5 16.4 16.420.6

33.3 34.7 33.1 29.9 28.1 27.0

0.0 0.0 0.0 0.0 0.1 0.1 0.1 0.1 0.2 1.0 0.9 0.9 1.1 1.0 1.4 1.4

0

10

20

30

40

50

60

70

80

90

100

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Perc

ent

Excise tax collection from alcohol products(Percent distribution)

Fermented liquors Distilled spirits WinesNote: 2017 Includes deficiency excise tax collected from Mighty Corporation amounting to P3,484,451,686.02

2018 Includes TRAIN incremental revenue for tobacco2003-2012 Collections based BIR Collection per GFS Classification (Cash Collection)2013-2018 Excise Tax Cash Collections based on Certifications submitted by BIR and BOC


74


On a per capita basis, Filipinos consume more distilled spirits than the rest of the world in 2017.

76

0

2

4

6

8

10

12

Philippines Asia-Pacific Global

Tho

usa

nd

mill

ilite

rs

Brandy Gin & genever Liqueurs Rum Specialty spirits Tequila & mescal Vodka Whiskey

11.0

9.3

8.0

Source: GlobalData. “Country profile: Spirits in the Philippines”. 2018.




78

0.27

0.64 0.68 0.72 0.77

1.11 1.15

1.68

2.11

0

1

2

3

Saigon Beer Red Horse/SanMiguel

Red Horse/SanMiguel (HB

1026)

Red Horse/SanMiguel (DOH-

DOF)

Beer Lao Singha Beer Bintang Carlsberg Tiger Beer

Vietnam Philippines Philippines Philippines Laos Thailand Indonesia Malaysia Singapore

U.S

. do

llars

Comparative price of popular beers(330 ml cans) in ASEAN

Using 2018 CPI and FOREX2019 prices from various online sources


9.711.7

21.7

24.627.3

40.6

0

10

20

30

40

50

China Philippines Hongkong Indonesia Thailand Singapore

U.S

. do

llars

Source: GlobalBrandPrices.com 2017

Comparative prices of Gordon’sLondon dry gin (700 ml) in ASEAN


81


9. To reduce the economic cost of alcohol:

PHP 211 billion to the economy by 2020

190.8211.2

232.7256.8

0

50

100

150

200

250

300

2019 2020 2021 2022P

HP

bill

ion

Economic cost

Sources: DBCC, July 2018; Rehm, 2009

Economic cost of alcohol is estimated at over one percent of GDP for middle income countries like the Philippines.

83


10. To rebalance the revenue sharing from 70:30 to 60:40 for tobacco and alcohol, respectively.

59%

41%

2010

Tobacco Alcohol

70%

30%

2015

Tobacco Alcohol

58%

42%

2020

Tobacco Alcohol

88


The proposed reform on alcohol excise tax

90


DOH-DOF proposal key features

Distilled spirits Fermented liquors Wines

1. Maintain the structure of having specific tax per liter.

2. Increase the unitary specific tax following the schedule.

3. Increase the indexation rate of the specific tax to 10 percent.

4. Remove the distinction of fermented liquors brewed and sold at microbreweries.

5. Tax alcopops as fermented liquors since they are marketed as beer substitute.

1. Maintain the structure of having both ad valorem and specific tax per proof liter.

2. Increase the ad valorem tax rate from 20 to 25 percent.

3. Increase the unitary specific tax following the schedule.

4. Increase the indexation rate of the specific tax to 10 percent.

1. Maintain the structure:• For sparkling wines, maintain the

two-tiered tax structure, based on net retail price.

• For still wines and carbonated wines, maintain the three-tiered specific tax, based on alcohol by volume.

• For fortified wines, maintain the tax as distilled spirits

2. Increase the specific tax following the schedule.

3. Increase the indexation rate of the specific tax to 10 percent. 91


Specific excise tax rates (PHP per liter)of fermented liquors (e.g., beer)

92

25

4045

5055

61

35

0

20

40

60

80

2019 2020 2021 2022 2023 2024

PH

P

DOH-DOF

Fermented liquors other than brewed

Brewed and sold at microbreweries

25

32 34 3639

41

35

0

20

40

60

80

2019 2020 2021 2022 2023 2024

PH

P

HB 1026

Fermented liquors other than brewed

Brewed and sold at microbreweries


Excise tax rates of alcopopsDOH-DOF

23

3234

3639

41

20

0

5

10

15

20

25

0

10

20

30

40

50

60

70

2019 2020 2021 2022 2023 2024

Perc

ent

PH

P

Specific Ad valorem

HB 1026

93

23

40

45

50

55

6120

0

5

10

15

20

25

0

10

20

30

40

50

60

70

2019 2020 2021 2022 2023 2024Pe

rcen

t

PH

P

Specific Ad valorem

For 2019, alcopops are taxed as distilled spirits with specific tax rate of PHP 22 per liter and ad valorem rate of 20 percent. Starting 2020, they will be taxed as fermented liquor with specific rate on a volume basis.


Specific excise tax rates (PHP per proof liter) of distilled spirits (e.g., brandy, rum, whiskey, vodka, and gin)

23

40

45

5055

61

0

10

20

30

40

50

60

70

2019 2020 2021 2022 2023 2024

PH

P

DOH-DOF

23

35

40

4548

52

0

10

20

30

40

50

60

70

2019 2020 2021 2022 2023 2024P

HP

HB 1026

94


Ad valorem excise tax rates (NRP per proof) of distilled spirits (e.g., brandy, rum, whiskey, vodka, and gin)

DOH-DOF HB 1026

20

25 25 25 25 25

0

5

10

15

20

25

30

2019 2020 2021 2022 2023 2024

Perc

ent

2022 22 22 22 22

0

5

10

15

20

25

30

2019 2020 2021 2022 2023 2024Pe

rcen

t

95


Preliminary estimates. Totals may not add up due to rounding.

DOH-DOF 2020 2021 2022 2023 2024 Total

Fermented liquors 24.7 31.4 37.8 44.0 50.8 188.8

Alcopops 0.4 0.5 0.5 0.6 0.6 2.7

Distilled spirits 8.2 9.8 11.4 12.9 14.5 56.7

Wines 0.04 0.1 0.1 0.2 0.3 0.8

Total 33.3 41.8 49.9 57.7 66.3 249.0

Estimated incremental revenue (PHP billions)

HB 1026 2020 2021 2022 2023 2024 Total

Fermented liquors 10.3 12.0 13.5 15.8 18.4 70.0

Alcopops 0.3 0.4 0.4 0.4 0.4 1.9

Distilled spirits 5.2 6.8 8.4 9.2 10.0 39.5

Wines 0.8 0.8 0.8 0.8 0.9 4.0

Total 16.6 19.9 23.0 26.2 29.7 115.498

Preliminary estimates. Totals may not add up due to rounding.


100

To finance the funding gap of the Universal Health Care (UHC).

Totals may not add up due to rounding.

Funding gap after the enactment of the increase in tobacco taxes (RA 11346)


Cross country comparison

101


Multi-tiered

Unitary

Excise tax structure of

fermented liquors among

ASEAN countries


Multi-tiered

Unitary


distilled spirits among

ASEAN countries


Multi-tiered

Unitary


wines among ASEAN

countries



fermented liquors

among ASEAN countries

Specific (liter)

Specific (proof liter)

Ad valorem

Mixed


Specific (liter)


Ad valorem

Mixed


distilled spirits among

ASEAN countries

106



wines among

ASEAN countries

Specific (liter)


Ad valorem

Mixed

107


Impact on prices

108


Fermented liquors

Red Horse Beer/1000 mlManufacturer: San Miguel BreweryAlcohol content: 6.8 percentProof: 13.6 percent Proof liter: 13.6 percentNet retail price: PHP 51.16

2020 (no reform) 2020 (with reform)

PHP

SRP 86.90Excise 26.43

PHP

93.14 HB 1026

Excise: 32.00

102.10 DOH-DOF

Excise: 40.00

109


Alcopops

Gaz/200mlManufacturer: Destilleria Limtuaco, Inc.Alcohol content: 7.0 percentProof: 14.0 percentProof liter: 2.8 percentNRP: PHP 21.08

2020 (No reform) 2020 (With reform)

PHP

SRP 25.03Total excise 1.27

PHP

30.78 HB 1026

Excise: 6.40

32.57 DOH-DOF

Excise: 8.00

111


Distilled spirits

Emperador Light (brandy)/750mlManufacturer: Emperador Distillers, Inc (EDI)Alcohol content: 27.5 percentProof: 55.0 percentProof liter: 41.3 percentNRP: PHP 66.07

2020 (No reform) 2020 (With reform)

PHP

SRP 93.38Total excise 17.30

PHP

99.12 HB 1026

Excise: 22.43

102.65 DOH-DOF

Excise: 25.58114


Responding to 10 concerns of stakeholders

115


Responding to 10 concerns of stakeholders

1. The current tax structure is not fair because there are different tax rates for different alcohol products

2. A multi-tiered tax system based on net retail price (NRP) is more equitable than a unitary tax system.

3. Higher excise taxes will increase smuggling and illicit trade of alcohol.

4. Higher excise taxes will lead to job losses in the alcohol industry, and increase inflation.

5. Higher taxes can hurt the alcohol industry as well as the economy.

6. Higher excise taxes are regressive.

7. Alcohol taxes have a heavier burden on lower income groups.

8. Increasing alcohol excise will just make people shift to drugs.

9. Drinking alcohol is a coping mechanism, part of our culture, or a recreational activity which should not be taxed.

10. Increasing taxes will not change the behavior of current drinkers.116


1. The current tax structure is not fair because there are different tax rates for different alcohol products.

A. The 15th Congress, in its wisdom, legislated the current tax structure in the Sin Tax Reform to address weaknesses in the previous excise tax regime.

B. The ad valorem tax of spirits makes its taxation more equitable because of the wide price range across products.

C. The specific tax based on alcohol content of spirits help mitigate the risk of high-dose alcohol consumption.

D. The simpler specific tax on fermented liquor is due to its similar tax burden and alcohol content.

CONCERN 1 RESPONSE

117


2. A multi-tiered tax system based on net retail price (NRP) is more equitable than a unitary tax system.

A. A multi-tiered structure based on NRP does not discourage consumption.

B. It only works to encourage downward shifting to cheaper variants.

CONCERN 2 RESPONSE

119


3. Higher excise taxes will increase smuggling and illicit trade of alcohol.

A. Higher taxes are not the primary determinant of high levels of illicit trade in a country.

B. It is determined by the level of governance and enforcement.

C. This can be addressed by strengthening tax administration.

CONCERN 3 RESPONSE

121


4. Higher excise taxes will lead to job losses in the alcohol industry, and increase inflation.

A. The 2012 sin tax reform shows a slight decrease in employment in alcohol manufacturers but this quickly recovered in the following years since demand increased due to higher income of people.

CONCERN 4 RESPONSE

ParticularsEmployment in

distilling (spirits)Employment in

fermenting (beer)

2010 1,342 3,631

2013 1,066 3,888

2014 665 3,888

2015 1,340 4,087-40

0

40

80

120

2013 2014 2015

Pe

rce

nt

Growth rate of alcohol industry employment

Distilling, rectifying and blending of spirits

Manufacture of malt liquors and maltSource: ASPBI 123


5. Higher taxes can hurt the alcohol industry as well as the economy, and increase inflation.

A. Historical data show that higher excise taxes do not hurt the economy. Despite the sin tax reform in 2013, revenues of alcohol firms continued to grow.

B. Inflation impact is additional 0.12 percentage points only.

CONCERN 5 RESPONSE

0

40

80

120

2012 2013 2014 2015 2016 2017

PH

P b

illio

ns

Revenues of top alcohol companies in (in PHP billion)

San Miguel Brewery Inc. Asia Brewery Inc

Emperador Disillers Inc. Ginebra San Miguel Inc

Tanduay Distillers Inc Destileria Limtuaco and Company, Inc.

Source: SEC125


6. Higher excise taxes are regressive.

A. Sin products are equally dangerous to health regardless of socioeconomic status.

B. This regressive tax is really meant to help the poor stop consuming alcohol products.

CONCERN 6 RESPONSE

128


7. Alcohol taxes have a heavier burden on lower income groups.

A. According to the WHO, the harms caused by alcohol consumption (per liter) is greater for the poor than the rich, especially since the poor has little access to healthcare.

CONCERN 7 RESPONSE

130


8. Increasing alcohol excise will just make people shift to drugs.

A. Studies show that those who drink are more likely to smoke and use illegal drugs.

B. By increasing alcohol excise tax, we can reduce the consumption of all three unhealthy products.

CONCERN 8 RESPONSE

132


9. Drinking alcohol is a coping mechanism, part of our culture, or a recreational activity which should not be taxed.

A. Our proposal is not prohibiting the consumption of alcohol, rather, it is discouraging harmful consumption as it is linked to negative health and social effects.

B. It is also discouraging binge drinking among the youth, who faces the highest risk.

CONCERN 9 RESPONSE

133


10. Increasing taxes will not change the behavior of current drinkers.

A. Increasing alcohol excise taxes will reduce accessibility of alcohol, especially among the youth and poor, who are the most price-sensitive and faces highest risk.

B. This will result in less health and social issues linked with alcohol consumption.

CONCERN 10 RESPONSE

134


Summary

136


1. Ensure financial sustainability for health expenditure programs

Reforming alcohol taxation is a sustainable financing source for the full implementation of the UHC law.

The DOH and DOF proposed alcohol reform will result in an additional PHP 249 billion over the next five years.

137


2. Discourage excessive alcohol consumption for better health and social outcomes…

With the DOH and DOF proposal, the consumption of spirits, beer, and wine will be reduced by 18.3 percent, 20.6 percent, and 4.7 percent, respectively, after a four year implementation.

138


3. …and significant number of lives saved.

Consequently, this reform will result in almost 57,000 lives saved between 2020 and 2024.

Source: Salvador, Dante, Michael Mo and Reneepearl Kim Sales. n.d. “Simulating the health impact of updating alcohol tax rates in the Philippines.” Department of Health, Philippines.

140


4. Ensure a healthy, world class workforce needed to support our transition to a high income country status.

This alcohol excise tax reform is both a revenue and a health measure that will allow us to achieve a healthy world class workforce, capitalizing on our demographic dividend that most other countries do not have.

141


Link to DOF microsite/presentation:

http://taxreform.dof.gov.ph/

publication/recent-presentations/

142




Thank you.

Documents

Link to DOF microsite/presentation: ... · PhilHealth claims due to alcohol is PHP 68 million per year. At 42 percent support value of PhilHealth, actual hospital cost is around PHP