Philip Morris slammed for switching tack

A think tank on Thursday slammed Philip Morris Philippines Manufacturing Inc. (PMPMI) for flip-flopping on its stance toward sin tax reforms.

The Action for Economic Reforms (AER) said in a statement that PMPMI “was once a staunch advocate of much-needed excise tax reform, but is now resisting changes in the tax regime.

In 2003 when it was still competing against Fortune Tobacco Corp., PMPMI lobbied for a single-tier tax system, AER senior economist Jo-Ann Latuja said.

Now that the company has combined with its main rival to form PMFTC, cornering 90 percent of the domestic market, PMPMI has changed its tack and seeks to continue the same multi-tier system that it had wanted scrapped, Latuja said.

“We have a copy of a letter from Philip Morris to then President Arroyo expressing their support [for] a single-tier tax system,” Latuja said. “This letter confirms our doubts that Philip Morris … is protecting no one but its own.”

There are two bills pending with the House committee of ways and means. One is sponsored by Cavite Representative Joseph Abaya, which seeks a unitary tax system on tobacco and alcohol products to replace a law that taxed products based on several price brackets. The Department of Finance and PMFTC rival British American Tobacco support the Abaya bill.

The other is sponsored by Ilocos Sur Rep. Eric Singson, which mandates a gradual increase in taxes based on the previous multi-tier system. PMFTC supports this bill.