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MANILA - British American Tobacco will put off a plan to invest $200 million in the Philippines until such time Congress passes the sin tax reform bill.
"We're committed to invest in the Philippines. But we will not pour in the money until the excise tax reform is done. Until such time, our business operations in the Philippines will be limited," said James Lafferty, BAT general manager for the Philippines.
BAT manufactures and distributes brands such as Lucky Strike, Pall Mall and Kent.
Lafferty said the company has held a series of meetings with farmers groups in the Ilocos region and officials of the Department of Trade and Industry regarding the planned $200 million investment, but the executive stopped short of saying where the company intends to pour its money to avoid giving "false hopes" in the event the plan falls through.
BAT returned to the Philippine in February after leaving in 2009, allowing Philip Morris Fortune Tobacco Corp. to dominate the local market.
"Our position is simple. We just want a chance to compete in the market. I don't want any special treatment; I don't want any special grants from the government. We simply want a level playing field, meaning my brand pays the same excise tax as another brand at the same price," Lafferty said.
The company is pushing for the repeal of annex D of the National Internal Revenue Code, providing preferential tax treatment to brands that had existed before 1997. Annex D benefits PMFTC.
The House earlier approved House Bill 5727, which proposes two tax tiers for cigarettes and three for distilled spirits. The bill also provides for an 8 percent increase in the tax rate every two years.
The Aquino administration hopes to raise an additional P33 billion a year from the first year of implementing the sin tax reform - provided the bill hurdles the Senate.
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