In 2012, a Filipino teenager could walk up to a sari-sari store and buy a stick of cigarette for pocket change. Back then, a stick cost about a peso. Then Congress passed the Sin Tax Reform Law, and the country ran one of Asia’s most successful public health experiments.
The results are no longer up for debate. The share of current tobacco users fell from 28.3 percent of the population in 2009 to 23.8 percent in 2015, and to 19.5 percent by 2021. The Department of Health’s budget jumped 57 percent in a single year. The industry warned that smuggling would swallow those gains. It didn’t. A 2023 performance review of the reforms concluded that the Philippine experience shows illicit trade cannot justify blocking tobacco tax increases.
Fourteen years later, the same argument is back, this time aimed at vapes.
As the House Ways and Means Committee weighs the ProGRESS tax package, some legislators want to fold the vape tax into a single, lower rate, again citing illicit trade. Consider what that would mean for children. In the 2019 Global Youth Tobacco Survey, 14.1 percent of Filipino students aged 13 to 15 were current e-cigarette users. About a quarter had tried vaping, twice the 12 percent recorded in 2015. These are children who cannot legally buy the product. The most reliable barrier between them and a vape is price. Young people have the least money and the most years of addiction ahead of them. For a 14-year-old, a cheap vape is where the harm begins.
The Department of Finance has proposed a unified P72.90 excise rate for all e-cigarettes from 2027, plus a new P150 tax on each device. Congress should treat that as the starting point and build upward from there.
Sweetened beverages tell a subtler story. The 2018 TRAIN tax worked at first. Consumption fell by about 6.5% on average, with powdered drinks dropping 25 percent. Then its effect began to fade. Finance officials say consumption has been climbing again since 2022 because, unlike tobacco, the beverage tax was never indexed to rise yearly. A tax frozen in pesos is a tax that loses its effectiveness.
The exemptions matter too. Think of the Filipino breakfast table. As one legislator pointed out in hearings, a single sachet of 3-in-1 coffee holds four to five teaspoons of sugar, around a third of the WHO daily limit. So, exempting it makes little sense.
Britain’s soft drinks levy, tiered by sugar content, forced the industry to change. Between 2015 and 2024, the average sugar content of covered drinks fell by 47.4 percent, even as sales volume rose 13.5 percent. But reformulation is not the same as a healthier product. Much of that sugar was simply swapped for artificial sweeteners. In 2023, the World Health Organization advised against using non-sugar sweeteners for weight control, citing links to type 2 diabetes and heart disease with long-term use. Filipino endocrinologists have warned that artificially sweetened drinks carry their own risks of obesity and hypertension. Mexico has already drawn this lesson: since January 2026, it taxes ‘zero’ and ‘light’ drinks too. Congress should keep the Philippine tax on all sweetened beverages, whether sugar or substitute, and add higher rates and automatic indexation so the goal is less sweetness overall.
Our lawmakers do not need to look abroad for a model. The 2012 Sin Tax Reform Law already showed what works: steep tax increases, one uniform rate so no product becomes the cheaper escape, automatic yearly increases, and revenue earmarked for health. That formula cut smoking and funded health coverage for millions of Filipinos. Congress should apply the same formula, undiluted, to vapes and sweetened beverages.