Drilon may 'lose weight' over 2013 budget, sin tax

Posted at 11/05/2012 6:14 PM

MANILA, Philippines - Senator Franklin Drilon has challenging tasks ahead of him in the remaining months of 2012. Before the year ends, he has to ensure the passage of two crucial measures, which both entail heavy work: the 2013 national budget and the sin tax reform bill.

Speaking to reporters on Monday, he said he's confident that the Senate will pass both.

"We will pass both. I have the capacity for hard work," said Drilon, who chairs both the Senate committees on finance and ways and means.

"Maybe this is my way of losing weight."

Drilon took over as chair of the ways and means committee after its former head, Sen. Ralph Recto, resigned amid criticisms against his version of the sin tax bill. Critics slammed Recto's committee report as a watered-down version of the bill because projected sin tax revenues are only between P15 billion and P20 billion-much lower than the government's original proposal of P60 billion.

Debates on the measure will begin this week, and Drilon gave assurances that the bill will be passed swiftly. The budget bill, on the other hand, must be approved before yearend so the country won't have to operate with a reenacted budget.

Drilon explained that the sin tax bill must be passed before, or at least at the same time as, the proposed national budget for next year. He said revenues from additional sin taxes are needed to raise the health sector's budget and improve public health programs.

In the 2013 General Appropriations Bill, the Department of Health has a budget of P54 billion. Drilon said, however, that the agency needs P77.5 billion to be able to implement its plans, including giving health insurance to 5.2 million more poor Filipinos through PhilHealth.

He said the sin tax bill would be able to fill in the budget gap.

"What we need is P77.4 billion, which will enable us to enroll 5.2 million more Filipino families, repair regional hospitals, strengthen our public health programs," Drilon said.

"If we don't get the additional budget, the gap will remain a funding gap, and we will not be able to deliver the services that government should deliver."

Recto’s version

Despite disagreeing with Recto's sin tax version, Drilon will use it in defending the bill on the Senate floor. He said he has discussed the matter with Recto, and stressed that the bill is open to amendments. He did not say, however, the exact tax rates he will push for.

In an interview last month, Drilon said he will move to raise the projected sin tax revenue closer to the government's goal of P60 billion. After a caucus senators, however, administration officials agreed to a lower revenue of P40 billion.

Another ways and means committee member, Sen. Edgardo Angara, said senators must find a "sweet spot," or an amount between Recto's P15 billion and the government's P60 billion. He said P30 billion to P40 billion would be acceptable.

"That's my calculation of what could be acceptable and reasonable, satisfying both health and revenue interests, and at the same time preserving the livelihood of tobacco [farmers]," Angara said.