Some senators are eyeing to impose a tax on junk food to raise funds for the government’s coronavirus disease 2019 (COVID-19) pandemic.
“The other possible sin tax that government may possibly look at is from junk food, which has zero nutritional value and targets the youth. It has been proven that junk food causes obesity and other heart ailments,” Senator Sherwin Gatchalian, vice chairman of the Senate committee on economic affairs, said.
Last February, the Department of Finance (DOF) said that the excise tax collections from so-called “sin” products such as tobacco, alcohol, and sweetened beverages increased a total of P269.1 billion in revenues in 2019.
DOF officials projected the government’s revenue from the sin taxes for 2020 would be around P323.3 billion as it would now cover e-cigarettes, plus the scheduled increase in alcohol and tobacco excise taxes. These revenues would be allotted for the Universal Health Care Law implementation.
The pre-COVID projections, however, are expected not to be met due to the economic impact of the coronavirus crisis.
Senate President Pro Tempore Ralph Recto earlier warned that increasing taxes in general “is not a good idea” at this time, but said it could be imposed in the next months.
The DOF earlier said during the deliberations for “Bayanihan 2” that the national budget could only allocate P140 billion this 2020 for the economic stimulus measure.
Debts of the Philippines for COVID-19
Finance Secretary Dominguez said the Philippines already borrowed P1.2 trillion and $4.8 billion to boost the government’s COVID-19 response.
“Even though we have the cash, we also have to reserve the cash for a second round, and we don’t know when the COVID virus is going to be defeated. Many countries have already had a second wave,” he said.
“We might have a second wave. I hope we don’t, but we have to prepare for that, and we have to prepare for the long run. So like any family, you also have to make sure that you have enough for the future,” added Dominguez.