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Sin taxes to shrink with smoking ban

CEBU, Philippines - While the business sector welcomes the government’s move to ban smoking in public and enclosed places, it is also, on the other hand, urging the government to formulate ways to offset the anticipated drop in sin taxes.

President Rodrigo Duterte signed on Tuesday, May 16, Executive Order No. 26, that bans smoking in enclosed public places and conveyances nationwide.

Business leader Philip Tan, past president of the Mandaue Chamber of Commerce and Industry (MCCI), said that the implementation of the EO creates balance of health and taxes, as this becomes effective in reducing consumption of cigarettes.

Because of this, there is a need for the government to find ways of covering the short-fall of sin taxes collected that was already included in the budget.

On the other hand, Cebu Business Club (CBC) president Gordon Alan "Dondi" Joseph said that this development will only affect the bars, restaurant, coffee shops in short-term, as people will have to adjust to it in the long run.

For Joseph, the displacement in tax generation due to lesser sin tax collection can be compensated through other ways, "it’s better to have lesser tax than to kill people."

Besides, healthier people equates to high productivity among employees.

With the implementation of the ban, smoking will no longer be allowed except in designated smoking areas that follow guidelines set by law.

However, smoking areas are banned in certain public places such as schools, elevators and stairwells, fire hazard locations, medical facilities, and food preparation areas.

The EO also reinforces Republic Act (RA) No. 9211, or the Tobacco Regulation Act of 2003, which "prohibits the purchase and sale of cigarettes and other tobacco products to and by minors and in certain places frequented by minors."

All cities and municipalities nationwide are also "enjoined to form a local Smoke-Free Task Force," which will help impose the provisions of EO No. 26.

The EO also cited penalties as provisioned by RA 9211, which entail a fine of P500 to P10,000 for those violating the rules for smoking in public places.

Those who will violate the provisions on providing tobacco products to minors may be fined P5,000, face imprisonment of up to 30 days, or revocation of business licenses and permits. (FREEMAN)

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