Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

Fifteenth Congress
Second Regular Session

House Bill No.__5294

Introduced by HON. PRYDE HENRY A. TEVES, HON. GEORGE P. ARNAIZ
AND HON. JOCELYN SY LIMKAICHONG

EXPLANATORY NOTE

‘There has been a marked increase in the use of high fructose corn syrup (HFCS) as an
ingredient in non-essential processed foods that are sold in the country. A reading of
labels of carbonated beverages and juices, ice creams and yogurts, cakes and cookies
that are available in supermarkets show that HFCS is used as sweetener either solely
or in combination with refined sugar. Although HFCS in processed food items has
been around for decades, mostly in developed country markets like the United States,
the Philippines is only now beginning to adopt its use.

In the interest of the consuming public, there is a need to regulate - through taxation ~
the use of HFCS due to the persistent concerns on its effect on health. HFCS
consumption has been linked to obesity and increase in body weight. In a study
published in the American Journal of Clinical Nutrition, it was indicated that “fructose
does not stimulate insulin secretion or enhance leptin production. Because insulin
and leptin act as key afferent signals in the regulation of food intake and body weight,
this suggests that dietary fructose may contribute to increase energy intake and
weight gain.”! And even if it can be said there are scientific researches and studies
which disagree with this finding, caution and concern for the general welfare compels
this government to temper the use of HFCS until a more definitive conclusion is on
hand.

More than a police power measure, this proposed legislation is also a revenue
measure. The 20% excise tax on HFCS will add to the national income and help
finance social projects and programs across the country including those that promote
health, Moreover, since HFCS is used primarily by multinational companies and big
businesses in non-essential processed foods, the weight of the tax shall be minimal to
the ordinary Filipino consumer

‘Bray George, sn, Samara Joy, Popkin Barry.“Consumption of high-fructose corn syrup in beverages may play
a role in the epidemic of obesity” American Journal of Clinical Nutrition, 2004:79:537-43



Wherefore, the urgent approval of the bill is highly recommended.

PRYDE HENRY A. TEVES

-SOCELYN SY LIMKAICHONG



Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City, Philippines

15" Congress
First Regular Session

5294

House Bill No.

Introduced by HON. PRYDE HENRY A. TEVES, HON. GEORGE P. ARNAIZ AND
HON. JOCELYN S, LIMKAICHONG

AN ACT IMPOSING A TWENTY PERCENT (20%) AD VALOREM TAX ON HIGH
FRUCTOSE CORN SYRUP BY INSERTING A NEW SECTION IN, AND THEREBY
AMENDING FOR THE PURPOSE, CHAPTER VI, TITLE VI OF THE NATIONAL,
INTERNAL REVENUE CODE OF 1997, AS AMENDED.

Be it enacted in the Senate and in the House of Representatives of the Philippines in
Congress assembled:

Section 1. Chapter VI, Title VI of the National Internal Revenue Code of 1997, as amended, is
hereby amended by inserting a new Section 149-A to read as follows:

“Chapter VI- EXCISE TAX ON MISCELLANEOUS ARTICLES”
SEC. 149 Automobiles — x x x

SEC. 149-A. HIGH FRUCTOSE CORN SYRUP - THERE SHALL BE LEVIED,
ASSESSED AND COLLECTED A TWENTY PERCENT (20%) AD VALOREM TAX ON
ALL PRODUCED AND IMPORTED HIGH FRUCTOSE CORN SYRUP (HFCS),
REGARDLESS OF CONCENTRATION, GRADE, TYPE OR VARIETY, BASED ON THE
PRODUCER'S SELLING PRICE OR THE TOTAL VALUE OF IMPORTATION USED BY
THE BUREAU OF CUSTOMS IN DETERMINING TARIFF AND CUSTOMS DUTY

INCLUDING CUSTOMS DUTY AND ALL OTHER CHARGES, NET VALUE ADDED-
TAX.”

Section 2. Implementing Rules and Regulations — Within six (6) months from the effectivity of
this Act, the Secretary of Finance shall, upon recommendation of the Commissioner of Bureau of


Internal Revenue, promulgate the necessary rules and regulations for the effective
implementation of this Act.

Section 3. Effectivity — This Act shall take effect fifteen (15) days after its complete publication
in the Official Gazette or in at least two (2) newspapers of general circulation.

Approved,