The Sin Tax Reform Act of 2012 (RA 10351) is one year old (enacted December 20, 2012) and after its first year implementation, it seems to have exceeded its revenue target. BIR said sin tax collection in 2012 full year was P50.4 billion, and January-November 2013 collection was P91.6 billion, higher than full year 2013 target of P85.8 billion.
Now some legislators and the advocates of the law are asking, where is that money?
See various reports yesterday,
Phil. Star, Cayetano asks where sin tax money goes
Rappler, Senators: Where is sin tax money going?
Tribune, After 1 year of rich windfall, gov’t still has no sin tax IRR IRR
![]()
See also:
Tobacco Tax 6: On Cigarette Smuggling, February 27, 2012.
Tobacco Tax 7: DOH on NCDs and Tax Hike, March 04, 2012
Tobacco Tax 8: Ban Smoking, or Raise its Tax?, March 12, 2012
Privatization 4: Utilizing Proceeds and Revenues, August 06, 2010
Privatization 8: Government Debts: Military Camps and Spratly Issue, June 20, 2011
Privatization 9: PAGCOR and Casino Operations, May 16, 2012
Fat-Free Econ 12: Privatizing PAGCOR, June 08, 2012
Privatization 10: More on Selling PAGCOR, June 12, 2012
Now some legislators and the advocates of the law are asking, where is that money?
See various reports yesterday,
Phil. Star, Cayetano asks where sin tax money goes
Rappler, Senators: Where is sin tax money going?
Tribune, After 1 year of rich windfall, gov’t still has no sin tax IRR IRR
This is one reason why earmarking legislation, setting aside the projected revenues to particular sectors and government agencies, is wrong. I don't support earmarking of any revenue measures from new tax or tax hikes, or privatization proceeds. The supposed beneficiaries of earmarking are setting themselves for great disappointment. This happened after Fort Bonifacio privatization, others. Will happen in the future.
Soon, PAGCOR will be privatized, there is no way out with huge public debt of the government, rising by P400-P450 billion a year (!!!) but to privatize it and a few other govt corporations. Other agencies like DepEd, SUCs, LGUs, etc. will lobby for earmarking too for themselves, to the exclusion of other sectors or departments. Wrong. New revenues from whatever sources should be used mainly to reduce the public debt. Savings from interest payment alone, P330-350 billion a year, can be used for priority sectors and departments.
Those who campaigned hard for the passage of this law need not throw the towel. For now, it should be a lesson foe rhwm that earmarking legislation is wrong. They are setting themselves for huge disappointment.
They should also watch PAGCOR privatization, at least P200 B or more, of additional revenues, but other Departments will lobby for earmarking, and exclude public health, agri, etc. Winner take all for the strongest lobbyists among different agencies.
Meanwhile, see this new development. DOH is not so much a fan of the UP PGH, it thinks that the Department has been giving away research money somewhere else. From interaksyon,
----------See also:
Tobacco Tax 6: On Cigarette Smuggling, February 27, 2012.
Tobacco Tax 7: DOH on NCDs and Tax Hike, March 04, 2012
Tobacco Tax 8: Ban Smoking, or Raise its Tax?, March 12, 2012
Privatization 4: Utilizing Proceeds and Revenues, August 06, 2010
Privatization 8: Government Debts: Military Camps and Spratly Issue, June 20, 2011
Privatization 9: PAGCOR and Casino Operations, May 16, 2012
Fat-Free Econ 12: Privatizing PAGCOR, June 08, 2012
Privatization 10: More on Selling PAGCOR, June 12, 2012