How Will the Beverage (or Sugar) Tax Affect the Filipino People?

I have written about the beverage tax in a previous article and how it will affect minimum wage workers the most. In case you haven’t heard of the beverage tax, yet – also known as the Sugar Sweetened Beverage Tax (SSB Tax) – the Congress has proposed to impose a Php 10 to 20 liter tax increase on all beverages that contain any form of sweeteners – may it be low- or no-calorie sweetener – and not just sugar. (Read the complete bill here.)

This might not sound like a lot to some of you. However, majority of the population who earn minimum (or even below minimum) wage – who will NOT benefit from the lower income tax proposal of the Department of Finance – will be the ones to shoulder the burden of the additional tax. With no increase in their daily wage, and a higher price on the beverages they consume like coffee and energy drinks, many see this as an unnecessary problem.

This will take a big chunk from their limited daily budget for the family.

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Julian Carag, 25, shares what life was like when he first started working and why he was so affected when he first heard about the beverage tax. Julian started working when he was only 18 because his family was almost bankrupt. He stopped going to school to work and help out with the household expenses. For him, every peso counted back then. His job, however, required him to come in at 2am. “I really needed caffeine and sugar in my system every night to keep me awake and sane,” he shares. Looking back on those days, Julian really feels for people going through the same thing and who will have to live with the beverage tax now. “This will greatly affect their monthly budget,” he exclaims. “I can’t imagine a world where they increase the prices of basic commodities, such as drinks like coffee, juice, and even energy drinks.”

Julian is passionate about having been part of the community that enjoys 3-in-1 coffee and soda during his meals and before his work shifts. “I’m glad the beverage tax wasn’t imposed back then because even though they say that I would have benefited from the lower income tax, I still would’ve had to pay more for basic commodities. It’s not a win-win at all.”

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Mary Penales, 29, also speaks up about how the beverage tax will affect her and her family. “Hindi po malaki suweldo namin, so hindi kami nakakainom ng soft drinks araw-araw,” [“We don’t make a lot of money, so we don’t get to drink soft drinks everyday,”] she shares. “Tuwing birthday, ganyan, dun lang kami umiinom ng soft drinks. Pang-party talaga siya. O kaya pag mataas grades ng anak ko.” [“When there’s a birthday and stuff, that’s the only time we drink soft drinks. It’s more for a party. Or when my kid gets good grades.”] After explaining the beverage tax to her and the 10 to 20-peso increase, Mary looked shocked. “Ang laki naman ng tinaas niyan! Eh hindi nalang kami magsosoft drinks. Tubig nalang!” [“That’s a high increase! We just won’t drink soft drinks anymore. Just water!”]

She laughed as she said this, but she later talked about how the beverage tax felt like a burden. “Imbes na matuwa kami pag may party, malulungkot nalang kami kasi mas malaki pa ang ilalabas namin na pera,” [“Instead of enjoying the party, we’ll just feel sad because of how much money we had to pay for it,”] she explains. Clearly, the beverage tax will remove the happiness that usually comes with the thought of a reward or treat. “Pati ‘yung kape naman, dapat bawas-bawasan na namin ngayon dahil diyan,” [“We’ll also have to drink less coffee because of this,”] she adds.

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Being the one in the family who manages the household expenses and buys the groceries every few weeks, I obviously have a lot of feelings on this, as well (thus the articles).

I wouldn’t make a big fuss about a one-time 10-peso or 20-peso payment.

However, I buy a lot of 3-in-1 coffee and other products with sugar in it for the household every week. I also know how much more I will need to shell out for them after the beverage tax. As such, it is now a different story. These price increases will definitely add up in the long run.

I may be lucky enough not to be earning minimum wage at this point in my life, but I did once upon a time and I feel for the people who have to shell out more money on basic commodities like juice, coffee and soft drinks, even though they will not be benefiting from the lower income tax rates.

Overall, the increase in prices will affect a lot of Filipinos, particularly the poorest segments in the country. This isn’t in line with the government’s goals of creating a simple, fair and more efficient tax system to promote investments, create jobs, and reduce poverty.

On the contrary, it looks like it might do the opposite. So, is the beverage tax really a good idea for the Filipino people? Share your thoughts with us.