By Chino S. Leyco
PMFTC, Inc., the local affiliate of Philip Morris International (PMI), plans to launch its heated tobacco product within the first six months next year despite threats of higher taxes on cigarette alternatives.
Denis Gorkun, PMFTC president said that the pending higher tax proposal being pushed by the government would not halt the planned entry of the company’s tobacco heating system IQos into the Philippines in 2019.
“You know, taxation is nothing new. We have clear positions that we have stated many, many times that taxation has to be taken with a gradual approach,” Gorkun said. “The key is to make sure that the tax increases are in line with GDP [gross domestic product growth] and inflation.”
Last week, President Duterte asked the Senate to immediately pass the proposal seeking a significant increase in the tax rate on heated tobacco and vapor products to ₱45 from ₱10. Once passed, the tax will be aligned with the levy imposed on combustible cigarettes.
But Gorkun is opposing the proposed ₱45 tax rate on heated tobaccos, noting taxation “has to be proportionate to the risk.”
He said there were several independent studies proving that smoke-free cigarettes like IQos were significantly less harmful than combustible tobacco products.
“Multiple government agencies around the world have certified that IQos have a fraction of chemicals compared to cigarettes. For people who cannot quit smoking, they should be encouraged to switch to those much better alternatives,” Gorkun explained.
For this reason, he believes “the taxation in short has to be risk proportion. This product costs significantly less than manufactured cigarettes and of course they bear much lower risk.”
Gorkun said that PMFTC is planning to launch IQos in the Philippines in the first semester of next year and assured that their tobacco heating system is not a threat to health.
On Friday, the Department of Health reported the first confirmed case of electronic cigarette or vaping-associated lung injury (EVALI) in the central Visayas.
Sought for comment on EVALI, Gorkun said “it’s up to investigation to really conclude what was the specific issue.”
But Gorkun pointed out that 13 million IQos users all over the world have not encountered any health-related problem after using the device.