Philippine cigar industry

If you think American cigar smokers have it bad–think again. House Bill 5727, a bill currently pending in the Senate of the Philippines, will impose a 12,000% increase in the tax imposed per cigar, from P1.25 per cigar to P150 per cigar. You heard it right. That’s like paying $150 for a house blend.

In the Manila Standard yesterday, a letter from a Philippine cigar manufacturer caught my attention. You can just hear the desperation in his voice as he writes [emphasis mine],

“A Slim Panetela has a net selling price of 12.50 per cigar in a box of 25 cigars for P312.50 per box. If we apply the tax as per Sec 145 (A), the selling price of a Slim Panetela will jump to P162.50 per piece and a box of 25’s will sell for P4,062.50. This is a 1,300-percent increase in selling price.”

He also notes that any taxes the government plans on correcting from the hike won’t come through, because these businesses won’t exist.

So why is the Philippine government undermining the age-old tradition of its own people? Simple, it is being lobbied by the European Chamber of Commerce of the Philippines to pass the bill “as soon as possible and without delay.”

As the cigar manufacturer points out, the tax will essentially clear out local businesses, in both alcohol and tobacco, and clear the way for European and other companies to enter the market without local competition.

Pretty sickening stuff, if you ask me.