Congress is not likely to push for the proposed junk food tax nor an increase in the tax imposed on sugary drinks due to the difficulty in enforcement as well as their mixed impact on health and nutrition.
“Junk food tax—I don’t find a way of implementing,” said House Ways and Means Committee Chairman and Albay Rep. Jose Ma. Clemente S. Salcesa noting that it will be difficult to enforce.
Speaking at the Philippine Stock Exchange (PSE) during a forum on legislative reforms, he explained that the amount and value of salt and monosodium glutamate (MSG) in these products are too low to be of significance while they will be hard to quantify and enforce since most of these items are produced and sold by the informal sector.
Salceda also pointed out that the link of these ingredients to health issues are not as clear as the connection between sugar and obesity and diabetes. Sugar content is also easier to quantify at source.
However, he pointed out “implementing sugary drinks tax will produce more malnutrition than reduce obesity” adding that, “We now have the highest tax on sugar in the world at six pesos.”
While Mexico, one of the world’s largest consumers of softdrinks, has only a P3 tax but and was able to reduce obesity from 76 percent to 67 percent.
Salceda said the Philippines does not have an obesity problem since its obesity rate is only 22 percent and, “even if you reduce it, it will only be down to 17 percent. But malnutrition will shoot up by 12 percent!”
This is because sugar or glucose accounts for a significant portion of the Filipino’s diet and lowering the consumption may mean that the poor may not hit their recommended daily allowance (RDA).
Meanwhile, Salceda said they have also junked the proposed luxury goods tax because of the need to refund tourists for value added tax. The tax refund is usually given to tourists as an incentive for them to go visit a country and go shopping.
“So if (tourists) pay P7 million for a belt, they would expect customs to refund they 25 percent of P7 million… it will just be stolen. So the House Ways and Means Committee thought that it is not longer workable if we have to refund,” he said.