THE BITTER COST OF BEING POOR

‎It's 5 a.m. on a weekday. I have a class at 7:30 a.m., and I still don't feel like waking up just yet. I boil some water, grab the half-used twin pack 3-in-1 coffee sachet, and pour the remaining half into my cup. It’s not fancy. It’s the warm, sweet, caffeine kick that gets a sleepless student like me through life while on a tight budget. Now even that is under the threat of another excise tax.

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Under the TRAIN Law, the Philippines currently imposes an excise tax of ₱6 per liter on sugar-sweetened beverages containing caloric or non-caloric sweeteners and ₱12 per liter on those using high-fructose corn syrup (HFCS). Now, the Department of Finance (DOF) wants to raise these rates to ₱20 and ₱40 per liter, respectively, with annual increases of around 5 percent, while expanding the tax to cover frozen desserts such as ice cream and frozen yogurt. The proposed increases form part of the DOF's broader ProGRESS tax reform package, which also includes measures intended to provide tax relief to certain income earners. As the department consults stakeholders on the package, these changes remain proposals rather than amendments already in effect.

Meanwhile, lawmakers have pursued their own measures on sweetened-beverage taxation. House Bill No. 5003, authored by Rep. Cielo Krisel Lagman, seeks to expand the allocation of tax revenues for nutrition programs, while House Bill No. 5969, authored by Rep. Antonino Roman III, proposes raising the excise tax from ₱6 to ₱20 per liter. All of these efforts reflect a broader debate over how the government should raise revenue and address sugar consumption, but they also raise a question that deserves equal attention: who will bear the cost of these changes?

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The government has a good reason to be concerned about the country’s rising obesity rates. Data from the DOST-FNRI’s 2025 Updating Survey put obesity among Filipino adults aged 20 to 59 at 44.5 percent, a worrying increase from 39.8 percent in 2023. But while these figures make the case for taking the problem seriously, they do not automatically make every proposed tax increase the right solution. The Department of Finance expects its proposed changes to generate nearly ₱297 billion from 2027 to 2030, giving the government another reason to push for them. 

Sure, a higher price might discourage some people from buying sweet drinks, but for families already stretching every peso, it also means making room for another increase in the cost of everyday living. And that tells why the proposal deserves closer scrutiny: not simply in what it hopes to achieve, but in who will have to pay for it.

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The government’s ProGRESS package does include higher taxes on luxury vehicles worth more than ₱8 million, private sea vessels, aircraft, and other non-essential goods. But it also raises questions about priorities. If the government can look to luxury purchases as another source of revenue, it should also consider whether raising taxes on everyday consumption is worth the burden it places on ordinary Filipinos. After all, a policy meant to address a public-health problem should not lose sight of the people it claims to protect.

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‎The debate becomes even more personal for the average Filipino when we consider products like 3-in-1 coffee, a cheap and convenient staple for many Filipinos who need something to get them through the day. The DOF had previously considered removing the tax exemption on 3-in-1 coffee and flavored milk, but set the idea aside, recognizing how heavily these products are consumed by lower-income households. Separate proposals in Congress have also raised questions about how such products should be taxed. 

This does not mean that taxing inexpensive goods is automatically unfair, nor does it prove that the government intends to burden the poor. But it does show that affordability matters when designing these policies. If the government itself recognizes that a tax can weigh more heavily on those with less to spend, then that concern deserves to be taken seriously when considering further increases.

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Still, it would be too easy to dismiss the tax as another burden on the poor. A 2019 study published in the Bulletin of the World Health Organization (WHO) found that sweetened-beverage taxation in the Philippines could reduce premature deaths and healthcare costs, while potentially providing substantial health and financial protection benefits to poorer households. Its projections also suggested that the poorest fifth of households would shoulder a smaller share of the additional tax burden than wealthier households. 

These findings show that the effects of a consumption tax are not always as straightforward as they seem, especially when health benefits and the use of tax revenue are taken into account. But the study examined the existing tax, not the much steeper increases now being proposed. Under the DOF's proposal, the excise tax would rise from ₱6 to ₱20 per liter for beverages using caloric or non-caloric sweeteners, and from ₱12 to ₱40 for those using high-fructose corn syrup. These are increases in the tax itself, not guaranteed increases in retail prices, which will depend on how much of the additional cost manufacturers and retailers pass on to consumers. The question, then, is whether these higher rates will meaningfully encourage healthier choices and deliver benefits that justify the added cost for ordinary Filipinos.

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Wealthier Filipinos, of course, are not entirely exempt from the proposed tax increases. The ProGRESS package includes higher taxes on luxury vehicles and other non-essential goods, while separate legislative proposals have explored additional ways to tax wealth. House Bill No. 11465, filed during the 20th Congress, also proposes higher excise taxes on such expensive vehicles, while groups such as IBON Foundation have advocated broader wealth taxes on the ultra-rich. 

These proposals are distinct, and their projected revenues should not be treated as directly comparable without examining what each tax covers. The debate over who pays more, then, is not as simple as whether the wealthy are taxed, but how far the government is willing to go in asking them to contribute.

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The poverty rate has since declined in our country. The Philippine Statistics Authority (PSA) reported a record-low poverty incidence of 9.7 percent in 2025, equivalent to around 11.08 million Filipinos. But the official poverty line does not tell the whole story. A September 2026 policy note by the Philippine Institute for Development Studies points out that the country's poverty threshold remains below the World Bank's benchmark for upper-middle-income economies. Using that higher benchmark of US $ 8.30 per person per day, the World Bank estimated that 58.7 percent of Filipinos were living below the line based on data from 2023. This shows just how many Filipinos may still struggle to meet their needs. With inflation, oil shocks, and rising prices already squeezing household budgets, higher taxes on everyday goods risk eating into the modest gains families have made.

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The government's public-health objectives are legitimate. Excessive sugar consumption contributes to diabetes, heart disease, and other illnesses that place a burden on both families and the healthcare system. Revenue for PhilHealth and nutrition programs is also necessary. But the legitimacy of these goals alone does not settle whether the proposed tax increases are justified. 

That depends on whether the higher rates meaningfully improve health outcomes, whether affordable alternatives are available, and whether the benefits outweigh the added burden on ordinary consumers. If higher taxes are meant to encourage healthier choices, the government must also consider whether those choices are within reach of the people being asked to make them. It is difficult to encourage families to switch to healthier alternatives when those alternatives remain beyond their budgets. 

A more balanced approach would pair taxation with affordable nutritious food and drinks, targeted support for low-income households, and clear accountability for how the revenue is spent. Public health should not be measured by how much the government collects, but by whether Filipinos can actually afford to live healthier lives.

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‎Tomorrow morning, millions of Filipinos will wake up before sunrise, prepare for work or school, and reach for whatever they can afford to keep themselves going. For some, that means a proper breakfast. For others, it means a sachet of 3-in-1 coffee and the hope of making it through another day. 

There is something bitter about a society that asks its poorest to make healthier choices without first making those choices affordable. A cup of coffee will not solve poverty, nor will taxing it solve the country's health problems on its own. But for someone who already has to count every peso, even the smallest comforts carry a cost. And when the price of getting through the day keeps rising, the bitterest part is knowing that some people have far less room than others to pay it.

Article: Rikki Jan Ebias

Illustration: Kaiser