Sin tax collections down in 9 months

MANILA, Philippines — According to preliminary data from the DOF, excise tax collections of the Bureau of Internal Revenue (BIR) and Bureau of Customs (BOC)   from the four product categories decreased to P193.7 billion from January to September compared to P211.8 billion in the same period last year.

This is equivalent to 82.3 percent of the government’s P235.3 billion revised target for the year.

DOF records showed that collections from January to May went down year-on-year, with the steepest decline seen in April when Luzon was placed under enhanced community quarantine.

That month, excise taxes from the four product categories fell by more than 78 percent to P5.3 billion from P24.2 billion in April 2019.

However, collections showed improvement starting  in June, when Metro Manila and other areas in the country shifted to a more relaxed general community quarantine.

The uptrend continued up until September, with collections up by nearly 39 percent to P29.2 billion from P21 billion.

Of the total amount collected from January to September, P114.6 billion came from tobacco products, 6.8 percent lower than the P123 billion recorded in the same period last year.

Excise tax collections from electronic cigarettes, meanwhile, reached about P200 million so far.

This is the first year the government is collecting taxes from e-cigarettes due to the passage of two new sin tax reforms. Republic Act 11346 made heated tobacco products and vapor products subject to excise taxes effective Jan. 1, while RA 11467 later on increased the rates.

Excise tax revenues from alcohol products also amounted to P51.7 billion, 9.3 percent down from P57 billion last year.

Meanwhile, collections from sugary drinks dropped by 14.4 percent to P27.3 billion from P31.9 billion.

According to the Bureau of the Treasury, the government’s overall revenues in the first 10 months  went down by 8.41 percent to P2.37 trillion from P2.59 trillion a year ago.

During the 10-month period, the BIR generated about P1.6 trillion in revenues, 10.38 percent lower than last year’s  P1.78 trillion.

The collections of the BOC likewise dropped by 15 percent to P448.6 billion from P527.7 billion last year.