Philippine Clean Air Act of 1999, Ecological Solid Waste Management Act of 2000, and Clean Water Act of 2004 are some of the environmental laws enacted to preserve the country’s natural resources and to balance environmental protection and economic development. It is evident that the Duterte administration is considering this balance with the rehabilitation of Boracay Island and ongoing cleanup drive of Manila Bay.
Green Tax also termed as ecotax, environmental tax, carbon tax and pollution tax is levied on consumers or industries that directly or indirectly inflict damage to the environment. Revenues collected through Green Tax are utilized to fund projects and activities to offset the negative impact on environment brought about by these industries.
The Tax Reform for Acceleration and Inclusion law imposes a higher excise tax on automobiles, petroleum products, coal and cigarettes. Clearly, these increases in taxes would be able to contribute in the promotion of environmental protection and encouragement of the use of renewable-energy sources.
To further expand the efforts of the government to raise revenues to finance its environmental projects and efforts, it’s about time that a Green Tax be introduced in the Philippine taxation system. The following are some of the industries that can be subjected to a Green Tax:
Plastic products are one of the greatest pollutants due to improper disposal. There is also a rampant usage of plastic sachets for shampoo and powdered drink that remain as environmental waste. To compel manufacturers of these products to innovate and produce reusable or an eco-friendly packaging, a Green Tax must be imposed on industries engaged in the manufacture or usage of plastic bags, sachet container, plastic tubes, Styrofoam, plastic straws and other plastic related products. These firms can be taxed based on the volume of production or usage.
Green Tax can also be charged to manufacturers of wooden-based products such as furniture, paper and tissues, so as to be able to generate government revenues for the conservation of forests and trees.
Motor vehicles that use fuel resulting in the emission of harmful smoke or carbon monoxide must be subjected to Green Tax. The amount of Green Tax can depend on the engine size of the vehicle.
Electronic gadgets and appliances contain harmful toxic chemicals such as lead, cadmium and toxic flame-retardants. Manufacturers and sellers of these products must be subjected to Green Tax and must be required to provide facilities where their customers can dispose products for discarding.
Green Tax can be incorporated with excise or “sin” taxes on tobacco-based products. Increasing the price of these products with higher taxes may discourage consumers to patronize them and to promote health and welfare. Further, residues from cigarette butts scattered in the streets will also be reduced.
Other neighboring countries in Asia have been resorting to taxation as a mode to control the impact of pollution and preservation of its natural resources. China has introduced an Environmental Protection Tax law effective 2018 and Singapore legislated its Carbon Tax effective 2019. These countries can be the benchmark of the Philippines in the enactment of its Green Tax legislation.
In pursuing a Green Tax law, our legislators must avoid the issue of double taxation issues on the overlap of the Green tax with the existing excise or sin taxes.
I appeal to our honorable legislators, Department of Environment and Natural Resources, academicians and various environmental groups to work together and consider the institution of Green Tax in the Philippines not only for revenue generations but to preserve our natural and irreplaceable resources.
This column accepts contributions from accountants, especially articles that are of interest to the accountancy profession, in particular, and to the business community, in general. These can be e-mailed to boa.secretariat.@gmail.com.
Jeffrey Galang Salazar is a Certified Public Accountant and a Master in Business Administration degree holder. He is a PRC-BOA accredited public practitioner and professor.
2 comments
Carbon Dioxide in the atmosphere is not deleterious to us human beings. In the absence of it, there will be no trees, flowers and vegetables that requires for it to grow, that we need to survive. Although admittedly, by the eminent scientists that attended the International Conference on Climate Change, since the beginning of the industrial revolution there was a significant increase of CO2, they could not determine by how much was solely the contribution of man. These scientists prefer for the warm climate than for the cool weather which is I believe the preference of most of the people around the world, but there are more deaths recorded in the cool countries than there was in Africa which is warmer. Hence I disagree with your opinion about the levying of carbon tax, which is a ploy by the UN to redistribute the wealthy nations into the Third World.
Hi Mario Sori. Green tax also applies on companies using scare resources such as wood, producers and manufacturers of plastics and the wide-spread solo sachet.