Prices of Liquor, Tobacco to Rise Anew on January 1

To help the Bureau of Internal Revenue (BIR) collect an estimated P33 billion in revenue, the prices of cigarettes and liquor will increase starting January 1, 2014.

The new price hike is part of the second round of increase for “sin products” in accordance with the sin tax law or RA No. 10351.

Gma News Online reported the revenue will be used to fund health and livelihood works for tobacco farmers who will be affected by the increase.

The online report presented the new taxation scheme as follows:

Fermented Liquor (per liter)

Costs less than P50.60 will be taxed P17 (from P15 in 2013)
Costs more than P50.60 will be taxed P21 (from P20 in 2013)

Tobacco (per pack of cigarettes)

Costs less than P11.50 will be taxed P17 (from P15 in 2013)
Costs more than P11.50 will be taxed P27 (from P20 in 2013)

BIR Commissioner Kim Henares was quoted saying “Common sense would say na prices [of liquor and tobacco products] will go up by P5, minimum.”

Republic Act No. 10351 or the sin tax law was passed on Dec. 20, 2012. The law provides that the tax installments will be gradual, raising tax prices of liquor and tobacco products for five consecutive years until the year 2017.

The law allows the government to get an aggregate revenue of P39.5 billion in 2013; P45.7 billion in 2014; P52.3 in 2015; P57.7 billion in 2016; and P64.4 billion in 2017, Gma News Online reported.

Source: Gma News Online

Image Credit: www.philstar.com