It has finally arrived! The issue of having ‘sin’ taxes finally reached the country and has caught the public’s eyes.
‘Sin’ taxes, according to Investopedia (investopedia.com), mean that we’ll be adding taxes to vices such as drinking, smoking and gambling. The Senate had just had their third Senate hearing regarding this matter (update yourself by checking it out here). So many factors will definitely be affected, even economically. With my little knowledge on Economics, I know that when the price is low, the demand is high and when the price is high, the demand is low, a basic concept. This basic principle in Economics is exactly what the ‘sin’ tax is targeting.
The country could receive a striking blow economically because there are quite a big number of locals who succumb to these vices. For instance, our local farmers, who work daily to pick tobacco leaves and other ingredients in cigarettes, may lose their livelihood. It is what keeps them and their family with food and money for the education of their children. Without this, where would they be? What could they do? Is there an alternative prepared by the government to compensate their loss, if not money? Will they be given another job? Fear not! These farmers will (supposedly) get an incentive. According to an article on the Philippine Daily Inquirer’s Opinion column (click here for the full article) by Walden Bello last May 31st, 2012, ”farmers will get earmarked funds equivalent to 15 per cent of the incremental revenues from tobacco taxes that will be devoted to safety nets and alternative livelihood projects.”
The Department of Health is pushing for this Law to be passed as to lessen the number of death due to these vices. Excessive drinking and smoking proves to be very detrimental. Some may get off with minor illnesses but you will never know when it is too much. When the limit is reached, you won’t even know it. You may have cancer. The word may, need not apply because it may be too late. Also according to Walden Bello in his column, “300,000 people now die yearly from smoking-related diseases, and the majority of them come from the poor.” What is the cost of losing this much Filipino each year compared to passing this reform bill? So, how can the government control the number of the affected people? Pass the ‘sin’ tax.
Everything has its advantages and disadvantages. In this case, an advantage is that the Filipinos can benefit from a healthier, cleaner, air and have fewer casualties to the smoking-related diseases. There could be more if we just knew how to look at the bill in another’s perspective. According to Mariah Reodica, the ‘sin’ tax reform bill can put us to a disadvantage as well. She said, “The problem with sin taxes too is that it actually encourages people to partake in vices more (if they can afford it, that is) because they feel like paying for the sin tax is a way of justifying that they don’t have to feel guilty for their vices.” To this, we can say, yes, it is indeed true but remember, according to Walden Bello, most of the smoking-related deaths each year come from the poor. With the passing of this bill, we can lessen the majority of the death to a minority.
In this issue, we are faced with the dilemma as to whom we should prioritize. Is it the farmers and laborers who get up each day to make a living for them and their family or to prevent the youth who, through excessive smoking, may develop disorders in their organs or worse, cancer?
Everyone has an opinion to everything. Even the youth has a say to this matter. What’s yours?