MANILA — The national government expects a revenue windfall of P2.67 billion this year from the recently enacted excise tax law, data compiled by the Department of Finance (DOF) showed.
Based on the 2014 proposed national budget submitted to Congress, the DOF expects an incremental revenue of P36.33 billion from the enforcement of Republic Act No. 10351 or the Sin Tax Reform Act of 2012, which took effect last Jan. 1.
The expected revenues from the new excise tax this year were higher by 7 percent compared with the P33.96 billion target originally projected by the finance department.
Of the total projected incremental revenues, the DOF expects that the increase in excise tax rate will generate additional P24.63 billion in revenues from tobacco products and P11.3 billion from alcohol.
With the additional revenues from RA 10351, the government is looking at generating a record P93.18 billion from taxes on the so-called “sin products” this year, higher by 64 percent than the P56.84 billion collected last year.
Revenue contribution from the excise tax on cigarettes this year is expected to increase by 75 percent to P57.57 billion from P32.94 billion collected last year.
Taxes from alcohol products are expected to contribute P35.6 billion to the government this year, higher by 49 percent than the P23.89 billion collected in 2012.
Finance Secretary Cesar V. Purisima had earlier brushed off criticism that cast doubt over the effectiveness of the enacted reformed excise tax law that restructured the levies on sin products.
Purisima particularly disputed the claim of the Lucio Tan group that illicit trade would become rampant after excise tax reform law on tobacco is implemented.
Purisima is given a two-year leeway before the government can fully reap the fruits of the RA 10351.
In the first semester of the year, the government’s excise tax collection from tobacco products reached P22.38 billion, higher by 53 percent than that of the previous year but short by P1.2 billion of the P23.5-billion target.
But despite the shortfall, Purisima is satisfied with the Bureau of Internal Revenue’s (BIR) performance in ensuring that taxes are properly collected from cigarette companies. (Manila Bulletin)