DoH makes pitch for sin taxes to close UHC funding gap
By Gillian M. Cortez
Reporter
THE Department of Health (DoH) said higher sin taxes will be required to fund expanded outpatient benefits and health insurance coverage for poor patients when the Universal Health Care (UHC) Law takes effect next year.
In a briefing Wednesday, Health Undersecretary Rolando Enrique C. Domingo said the imminent rollout of UHC makes it urgent to pass the proposed Package 2+ of the Comprehensive Tax Reform Program because this will be used to subsidize PhilHealth, the government health insurance program, which will move to universal coverage next year, as well as expand the scope of covered outpatient treatment.
“Most of the money that is earmarked for UHC coming from sin taxes will go to primary health care at ang enrollment ng mga kababayan natin na hindi makakbayad sa sarili nila sa PhilHealth kaya (and to enrol all Filipinos who are not able to pay for PhilHealth which is why) we really need that collection,” he said.
Package 2+ will increase taxes of alcohol, heated tobacco products and e-cigarettes.
The proposed budget of the DoH for 2020 is P160 billion, lower than the P254 billion needed in order to effectively roll out UHC next year. The UHC, signed in February, with its Implementing Rules and Regulations (IRR) released earlier this month, authorizes the enrolment of all Filipinos in PhilHealth, greatly expanding the insurance scheme’s responsibilities.
Under UHC, PhilHealth will have direct contributors paying their own premiums, and indirect contributors — the poor — who will be subsidized by the government.
Around P30 billion to P40 billion is expected to be collected under the proposed tax measures, according to Department of Finance (DoF).
The government proposal to raise taxes on sin products is also premised on future savings from long-term health improvement in the general population, in the form of reduced future health complications for smokers and drinkers.
At the briefing, Finance Assistant Secretary Antonio G. Lambino II estimated that the equivalent of 1% of GDP is spent on alcohol consumption.
“Aabot sa P211.2 billion ang magiging economic cost ng pagkonsumo ng alcohol sa taong 2020. Ang halagang ito ay katumbas ng one-third ng kabuuang gastos ng bansa sa health care (The economic cost of consuming alcohol is P211.2 billion in 2020. This is more than one third of the total spending on health care),” Mr. Lambino said.
The DoH said that more Filipinos have picked up the habit of using e-cigarettes and vaporizers, many of them young. Mr. Domingo said he received reports of children at the elementary level using these devices.
The DoH released an administrative order (AO) in June that regulates the use, sale, import, and manufacture of e-cigarettes and vapes but the order is currently subject to a court injunction pending challenges to the order’s legality.
The DoH’s position is that using these products is unsafe despite their being allegedly 95% safer than traditional tobacco products.
In other countries, reports have emerged of e-cigarette or vaping product use-associated lung injury (EVALI), with the US alone having more than 1,600 cases.
“We have been getting a few cases that we are going to be reported to our regional offices for validation and we hope to be able to present this to the press very soon,” he added regarding EVALI cases in the Philippines.
