The Sin Tax Bill How Its Affect the Bar Industry in the Philippines

Only available on StudyMode
  • Download(s) : 407
  • Published : February 25, 2013
Open Document
Text Preview
EXECUTIVE SUMMARY
TRENDS
In 2011, there was a tax increase on alcoholic beverages. The tax increase depended on the alcohol content and the net retail price of the beverage. This however had little effect on bars/pubs in the Philippines because the tax increase was not significant. Many consumers did not feel the price change too much because of the relatively high mark-ups at bars/pubs. PROSPECTS

In 2011, the Philippine government was reviewing a bill which proposes to increase alcohol and tobacco taxes quite significantly in the Philippines. If the bill is passed, this may negatively impact sales in bars/pubs in the Philippines. The higher prices of alcohol may result in less alcohol consumption by consumers when they dine-in at bars/pubs.

INTRODUCTION
MANILA, Philippines—A sin tax on cigarettes and alcohol dampened the New Year party spirit when it was introduced in the Philippines Tuesday, as part of a government bid to boost finances. Many stores started selling tobacco and drink at inflated prices before midnight, ahead of the official implementation of the tax hikes on January 1, 2013 hitting partygoers in the pocket. Tax on cigarettes will gradually be raised to P30 ($0.72) per pack by 2017, roughly doubling the current price to around 52 pesos. Duty on alcohol will also increase gradually until 2017, increasing the price of a bottle of beer by 23.50 pesos, with varying levels for other drinks including wine and spirits. It will be further increased by four percent each year thereafter. The new prices compared to countries like Singapore, for example, are still low, but for the ordinary Filipinos they are expensive, said Laudemer Angeles, a 33-year-old shop owner in the town of Bacoor, south of Manila. Many of my customers were complaining about the higher prices and were not too happy when they bought their booze and smokes for their parties last night. Anti-smoking campaigner Emer Rojas said he hoped the new taxes would lead to a gradual decline...
tracking img