By Tracy Cabrera
Pushing for the speedy approval of the new ‘sin’ tax reform law, the finance department stressed the law’s importance in helping fill the massive funding gap for the Duterte administration’s Universal Health Care (UHC) program and likewise ensuring affordable and quality health care for every Filipino family starting next year.
Speaking before the Kapihan sa Manila Bay media forum at the Café Adriatico in Malate, Manila, finance undersecretary Karl Hendrick Chua explained that much needed fiscal reforms should be put in place in the incoming 18th Congress to give the country “a good chance” if securing the much-coveted single ‘A’ grade for the country’s long-term sovereign credit rating within two years.
Chua was quoting from the pronouncement of finance secretary Carlos Dominguez III who said that a single ‘A’ investment grade credit rating would not only benefit government and the private sector but will also mean ordinary Filipinos would get to pay lower interest rates on their loans.
All of these, Dominguez said, will translate into larger investments and more jobs for Filipino workers.
In support, Chua stressed that although getting an upgrade would benefit the country, what is more important is upgrading ever Filipino’s life.
The finance undersecretary described the UHC law as another game changer that would benefit every Filipino. He warned, however, that government funds are not enough to fulfill its financing requirements beginning 2020, hence the introduction of the new ‘sin’ tax reform law.
“Increasing the excise taxes on sin products would provide the resources government needs to fill the funding gap for the full and proper implementation of the UHC law,” Chua pointed out.
In 2020, the first year of the UHC’s implementation—the program is estimated to cost around PhP258 billion, which government can cover from its current funding sources from the national budget, the Philippine Amusement and Gaming Corporation (PAGCOR) and the Philippine Charity Sweepstakes Office (PCSO) in the amount of PhP195 billion.
“Without ‘sin’ tax reform, UHC will be left with a funding shortfall of about PhP62 billion,” Chua disclosed.
“Without this law and at current premiums, members of the Philippine Health Insurance Corporation (PhilHealth) will continue to be covered for only 18 primary care drugs and seven health conditions while shouldering 90 percent of the cost prescribed medicines,” he added in conclusion.