Vested Interests Dilute 'Sin' Taxes

October 2004 | Market Strategy

There are increasing signs that the Philippines government will be unable to pass major reforms aimed at reducing the budget deficit, which is officially projected to widen to PHP197.8bn (US$3.50bn) this year. BMI's concerns stem from the fact that only one of eight key bills is likely to pass through Congress before Christmas - namely, increases in so-called 'sin' taxes (taxes on alcohol and tobacco). Even on this front, the original proposals are being diluted. The powerful Ways and Means Committee of the House of Representatives has voted to raise 'sin' taxes by 20% in 2005, which is well below

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