Taxing plastic bags

In August, the Senate revived the plastic bag tax discussion by introducing two new measures now pending in committee.

- STATIC MARVIN TORT

Senate Bill No. 811 proposes an excise tax on a wide range of single-use plastic packaging materials, not just bags. Senate Bill No. 865, meanwhile, limits the tax to single-use plastic shopping bags.These bills follow the House of Representatives' move in late 2022, when it passed a bill on a P100 per kilogram excise tax on single-use plastic bags, with a 4% annual indexation beginning in 2026. The House bill also earmarked the tax proceeds for municipal solid waste (garbage) management programs.

The two Senate bills mark the latest chapter in a debate that has been ongoing for some time, and one that I have written about several times before. The questions I raised as early as 2019, about six years ago, about tax design, enforcement, and impact remain just as urgent today.

I support the tax. Revenues earmarked for solid waste management, or simply proper garbage disposal, will be a big help. Plastic pollution can also be better mitigated by improving collection, disposal, and recycling, rather than by an outright ban on plastic production and use.

But any plastic tax must be designed with all stakeholders in mind, particularly consumers or end-users. Plastic has long been the practical and economical alternative to glass, cardboard, paper, and styrofoam packaging. It is highly unlikely that we will abandon it.

The Department of Finance (DoF) has consistently argued that an excise tax on single-use plastic bags will not only raise money for LGUs to implement waste management programs but also change consumer behavior by making plastic bags more expensive. It will also address the negative externalities of plastic bag use such as plastic waste clogging drains, worsening flooding, polluting rivers and seas, and contributing to climate risks.