Sin Tax Bill
Sin Tax Bill (For the Government)
OVERALL SUMMARY:
According to James Sadowsky, author of The Economics of Sin Taxes, taxes imposed on products seen as vices such as alcoholic liquors and tobaccos are called sin tax. Aside from the commodities being objects of disapproval, even their consumers accept such taxes because they seem to hit two birds in one stone. First, they raise revenues and second, they made vices expensive.
House Bill 5727 or also known as the Sin Tax Bill aims to reform the imposed tax on the sin products (Official Gazette, 2002). We support this bill for three reasons. First, the government can collect more revenues. Second, it promotes health by dissuading the consumption of the vices. And lastly, the poor sector benefits from it.
Sin tax is a form of an excise tax. It is a tax levied on some commodities but not all commodities unlike sales tax. This is how the government generates more revenues (Sadowsky). However, the opposition claims that this bill will backfire on its goals. Since the price of the price of the commodities will rise, the demand will decrease. Thus, there will be no revenues to generate which contrast one of the goals of the bill since industries such as tobacco will die. However, the products under sin tax are vices. Some people are already addicted to them. Even if the price of these products will rise, people will still buy though some price conscious such as the poor sector and students will cut their consumption (Fonbuena qtd. Monsod, 2012 ). Plus, even the demand for the sin products will decrease; the increased tax will make up for the loss demand. Thus, the industries will not die. The opposition also said that the rate of smuggling will worsen. However, according to economist and former Economic Planning Secretary Solita Monsod, there is no connection between the rise of the levied tax and smuggling. Countries such as Japan and Singapore who levied tax the highest on sin products even have the lowest rate of
OVERALL SUMMARY:
According to James Sadowsky, author of The Economics of Sin Taxes, taxes imposed on products seen as vices such as alcoholic liquors and tobaccos are called sin tax. Aside from the commodities being objects of disapproval, even their consumers accept such taxes because they seem to hit two birds in one stone. First, they raise revenues and second, they made vices expensive.
House Bill 5727 or also known as the Sin Tax Bill aims to reform the imposed tax on the sin products (Official Gazette, 2002). We support this bill for three reasons. First, the government can collect more revenues. Second, it promotes health by dissuading the consumption of the vices. And lastly, the poor sector benefits from it.
Sin tax is a form of an excise tax. It is a tax levied on some commodities but not all commodities unlike sales tax. This is how the government generates more revenues (Sadowsky). However, the opposition claims that this bill will backfire on its goals. Since the price of the price of the commodities will rise, the demand will decrease. Thus, there will be no revenues to generate which contrast one of the goals of the bill since industries such as tobacco will die. However, the products under sin tax are vices. Some people are already addicted to them. Even if the price of these products will rise, people will still buy though some price conscious such as the poor sector and students will cut their consumption (Fonbuena qtd. Monsod, 2012 ). Plus, even the demand for the sin products will decrease; the increased tax will make up for the loss demand. Thus, the industries will not die. The opposition also said that the rate of smuggling will worsen. However, according to economist and former Economic Planning Secretary Solita Monsod, there is no connection between the rise of the levied tax and smuggling. Countries such as Japan and Singapore who levied tax the highest on sin products even have the lowest rate of