The Market Monitor Minding the Nation's Business
By Riza Lozada
Two years after the Sin Tax Law was enacted, discrepancies on its use, primarily for the local health sector, were found.
The Senate tax research office, regarding the September 2014 initial review of the implementation of Republic Act 10351, otherwise known as the Sin Tax Act of 2012, said “the data provided by three agencies—the Bureau of Internal Revenue (BIR), Department of Trade and Industry (DTI) and the National Tobacco Authority (NTA)—all did not agree with each other.”
Moreover, the Senate body said government data also conflicted with those submitted by manufacturers.
The three agencies were required under the law to submit documents on the use of proceeds from sin- tax collections.
The manufacturers of cigarettes and alcoholic beverages were also participants to the sin-tax review.
This first attempt to review the sin-tax efficiency was conducted by the Senate in an effort to apprise of the early outcome of the passed bill on sin tax, the proceeds from which, among others, fund the national health program.
In compliance with the first review, the Department of Budget and Management (DBM) reported for fiscal year ending last September that sin-tax collections from alcohol and tobacco amounted to P22.68 billion.
The DBM claimed that there was 100-percent utilization of the excise-tax allocation for insurance coverage.
A cursory look at the status of the country’s hospitals revealed that a number of facilities entitled to the DOH’s Health Facilities Enhancement Program (HFEP), which are funded through excise taxes on sin products, were not getting the promised funds.
Access to delivery of health services, especially among indigenous people in the hinterlands of Paquibato and Marilog districts in Davao, for instance, are not even being given funding committed to it.
The Paquibato District Hospital (PDH) is a 10 bed-capacity primary hospital that gives free services, free medicines and hospitalization to the people of Paquibato.
The HFEP appropriated P1.5 million for the upgrading.
The Marilog District Hospital was designed to be a primary hospital with a 10 bed-capacity.
It did not have water and lighting facilities that it did not functioned as a hospital but offered only out patient services.
Newly constructed hospitals in South Cotabato also could not start operations due to budget lack. The DOH approved the release of around P70 million in grants for the expansion and upgrading of two hospitals in South Cotabato.
It also committed to complete the upgrading of these facilities before the end of the year.
On July 6 President Aquino approved the 2016 national budget worth P3.002 trillion, with the Department of Public
Works and Highways and the DOH receiving the highest increases in their annual budgets at 32 percent and 25.2 percent, respectively.
Presidential Communications Secretary Herminio Coloma Jr. said the increase in the budget “[is] part of efforts to boost public infrastructure development and support economic expansion, as well as to improve healthcare services, especially to the poor and most vulnerable sectors of society.”
Excise taxes collected from cigarettes and alcoholic beverages, or sin products, reached P33.4 billion from January to March this year, or an increase by 65 percent on-year.
Records show that under the 2015 budget, the DOH and attached agencies would get a P90.21-billion allocation, this according to an earlier report from Senator Teofisto “TG” Guingona III, chairman of the Senate Committee on Health and Demography.
The HFEP would get P13.1 billion, of which P10.337 billion will be allotted for the construction, rehabilitation and upgrade of 1,660 barangay health stations, 475 rural health units and city health centers, 168 local government unit hospitals, 66 hospitals under the DOH and 11 treatment and rehabilitation centers. Meanwhile, a total of P2.771 billion will be allocated for the procurement of quality hospital equipment.