By Lina Sagaral Reyes
CAGAYAN DE ORO – For growing Brightleaf tobacco, the town of Claveria gets more than P355, 666.474, which is 40-per cent of the P700-million share of the tobacco excise taxes for the year 2015 while the province of Misamis Oriental takes P210,166,552, 30 percent of the share, the Department of Budget and Management disclosed recently.
On the other hand, the remaining 30-percent is distributed evenly among Misamis Oriental’s 23 towns and three cities at P5.388,886 each.
The Brightleaf or Virginia-type of tobacco is grown in 1,231 hectares by 1,375 contract growers in Claveria, 71 kilometers southeast of this city, according to Ma. Mercedes Ayco, tobacco production and regulation officer for Mindanao of the National Tobacco Administration (NTA).
The Phillip Morris Fortune Tobacco Corporation (PMFTC) had invested $50-million for establishing the production systems and on-site processing of the crop in this town since 2012. The NTA noted that the annual production in 2015 hit 1,314, 969 kilos, or more than 1,300 metric tons, thus qualifying the province as recipient of the special financial support.
Under Republic Act 7171, which promotes the development of farmers in Virginia-tobacco producing provinces, Misamis Oriental is entitled to ‘’the special support fund for developmental projects to be implemented by the local governments of the provinces concerned.’’
According to DBM guidelines based on RA 7171, the special support fund to the Virginia tobacco-producing provinces shall be utilized to advance the self-reliance of the tobacco farmers through:
*Cooperative projects that will enhance better quality of products, increase productivity, guarantee the market and as a whole increase farmers’ income;
*Livelihood projects particularly the development of alternative farming system to enhance farmers’ income;
*Agro-industrial projects that will enable tobacco farmers in the Virginia tobacco-producing provinces to be involved in the management and subsequent ownership of these project such as post-harvest and secondary processing like cigarette manufacturing and by-product utilization; and
*Infrastructure projects such as farm-to-market roads.
The tobacco excise funds comes from the proceeds of fifteen percent (15%) of the excise taxes on locally manufactured Virginia-type of cigarettes.
The funds allotted shall be divided among the beneficiary provinces pro rata according to the volume of Virginia tobacco production. Towns where tobacco is grown gets 40-percent share, while the province gets 40-percent share and the rest of the towns and cities in the congressional districts of the province claims the rest of the 30-percent share, the DBM guidelines says. Misamis Oriental qualified as beneficiary as its annual production of Virginia leaf tobacco reached more than one million kilos in 2015.
Under Republic Act 10351 passed in 2013, the sin tax reform law, taxes on cigarettes and tobacco products increased by about 117 per cent. The 2013 tax policy is a legislative measure to fulfill the country’s commitment to reduce the demand of tobacco under the World Health Organization Framework Convention of Tobacco Control, of which the Philippines is a signatory.
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