Action for Economic Reforms (AER) emphasizes the increased importance of excise taxes on sin products (tobacco, vapes, e-cigarettes and alcohol) in the context of the COVID-19 pandemic. The virus threat exposed the critical role of sin taxes in ensuring quality public health for all Filipinos.
For one, there is a link between smoking and higher risk of developing serious cases of COVID-19. The Department of Health (DOH) issued a statement that users of tobacco products are more vulnerable to COVID-19. Multiple studies show that smoking greatly increases the risk of contracting hypertension, heart disease, and lung disease, among others. Both the World Health Organization (WHO) and the Centers for Disease Control and Prevention (CDC) have stated that those with pre-existing medical conditions such as those mentioned have a much greater risk of developing serious cases of COVID-19.
The pandemic also showed us the needed funding for health. All efforts to suppress the virus through the enhanced community quarantine are done to ensure that our health system is not overwhelmed by the rising cases. In total, 0.2% of our GDP is allocated for the health care spending package set up by the government. This will be mostly used to provide insurance for COVID-19 patients and also to procure protective equipment for our frontline workers. This allocation may not be enough to finance the country’s healthcare needs if the duration of the pandemic is prolonged. Hence, the role of sin taxes to increase funding for healthcare cannot be undermined for sustainability.
Given how the COVID-19 crisis has overwhelmed our health system, government all the more must quadruple efforts to finance and strengthen health care. Its strategy will necessarily include raising taxes for health financing and aggressively reducing consumption of products that undermine health. Further taxes on smoking and vaping will necessarily be part of the agenda.
In this emergency, let us continue to take all the necessary steps to protect ourselves from this debilitating virus. We look forward to a “new normal” where less Filipinos are exposed to the debilitating harms brought about by tobacco products.
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