Single-Use Plastic Tax to Generate ₱38 Billion

The government is predicted to generate ₱38 billion in tax revenues from the implementation of an excise tax on single-use plastics and contribute to addressing plastic pollution in the Philippines.

Department of Finance Secretary Benjamin Diokno has praised the approval of the third reading of the Single-Use Plastic Bags Tax Act in the Lower House. Since the beginning of the Marcos administration, the Department of Finance has been advocating for this.

The bill plans to impose an excise tax of ₱100 per kilogram on single-used plastics released from the Bureau of Customs or the place of production.

This would mean a 75% increase in the price of a pack of plastic “labo” bags or those plastics being used in purchasing ice or a kilo of rice in small stores. On the other hand, retail prices of “sando” bags or those being used in groceries and wet markets will experience a 75% increase.

With the added tax, volume is predicted to decrease by around 26%. However, the 70% assumption in collection efficiency would mean revenue of ₱38.06 billion in its first five years of implementation, from 2023 to 2027.

Aside from this, the proposed excise tax will annually increase by 4% starting in 2026. The revenues from this will be given to the Department of Natural Resources for use in the Ecological Solid Waste Management Act.

“The law is our contribution to the global movement to reduce pollution while raising revenues needed to manage economic risks and rehabilitate the country–like hitting two birds with one stone,” mentioned Sec Diokno.

Source: Philstar