Food manufacturers have warned of a 0.

5-percent contraction in
the gross domestic product (GDP) and the loss of jobs if the plan to
slap a P10 per liter excise tax on sugar-sweetened drinks is
approved in Congress as part of the Duterte administrations first
tax reform package.
Citing a University of Asia and the Pacific study titled An
Economic Impact Study of the Sugar-Sweetened Beverage bill on
the Beverage Industry in the Philippines published last year, the
Philippine Chamber of Food Manufacturers Inc. said that if House
Bill No. 292 authored by Nueva Ecija Rep. Estrellita Suansing
would be approved, the beverage industry is forecasted to lose
almost 44 percent of its volume because of the tax.
This is due to the fact that the P10 per liter tax will increase
exorbitantly retail prices of the more popular beverage products
from 30 percent to more than 100 percent. The projected volume
loss of such magnitude is alarmingly high and if realized, will
cripple the beverage industry, cause it to dramatically downsize
which in turn will cause negative ripple effects across the
economy, the chamber claimed.
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The punitive effect of this tax will not only affect businesses but
will also drive down household incomes of those related to the
industry and people will even lose jobs, it added.
The chamber said the excise tax on sugar-sweetened beverages
will cost the economy a net loss of more than P60 billion, as the
estimated P38.74 billion in revenue gain would be offset by
P101.55 billion in losses from declines in both industry sales and
production.
This loss is forecasted to reduce the countrys GDP at 2015 levels
by as much as 0.54 percent. The tax will have a strong negative
ripple effect across industries, according to the chamber
Read more: http://business.inquirer.net/229532/excise-tax-
sweetened-drinks-feared-adversely-affect-gdp-
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