CHAPTER I

INTRODUCTION

Rationale of the Study

Smoking causes adverse effects to nearly every organ in the body, diminishing overall

health. It is directly responsible for many cancers and a number of diseases. With this, it has

become one of the major causes of death worldwide. Smoking related diseases such as cancer,

stroke, lung and heart diseases cause death to one out of 10 adults globally and to 10 Filipinos

every hour. Smoking also causes increased absenteeism from work and increased health care

utilization and cost, affecting not only individuals but groups as a whole.

According to the Global Adult Tobacco Survey (GATS), the Philippines has 15.9 million

tobacco users—the country having the highest tobacco smoking prevalence among women in the

Western Pacific region. Out of those Filipino adult tobacco users, 18.7% are daily smokers, with

males consuming 11 cigarettes per day and females consuming 9 cigarettes per day on the

average. This high consumption rate is attributed to the very low pricing on cigarettes in our

country.

Cigarette products have put millions of lives at risk. This compelled the government to

develop and constitute measures that aim to discourage the public from consuming cigarettes,

eventually lowering the prevalence of cigarette consumption in the country.

The government imposed the Sin Tax Reform Act of 2012 with the aim to restructure the

existing taxes imposed on alcohol and tobacco products. Levies on these products are seen as a

potential revenue source that will help fund the projects of the administration. Likewise, higher

1
taxes—and consequently higher costs—are seen to restrain the consumption of "sin" products,

whose adverse effects are mostly borne by the poorer segments of society.

In 2017, the Philippine government introduced Republic Act No. 10963, otherwise

known as the Tax Reform for Acceleration and Inclusion (TRAIN) Act. This tax reform law

imposes higher levy on alcoholic beverages and tobacco products and is expected to raise

P162.75 billion this year, with excise tax on cigarettes reaching P111.59 billion. Both amounts

higher compared with the original target of P151.17 billion and P97.13 billion, respectively, set

under the 2018 Budget of Expenditures and Sources of Financing (BESF) program. From the

original tax rate of P31.2 per pack, excise tax on cigarettes is now at P32.5.

In the Philippines, Cebu is one of the most developed and populated provinces. It is the

country’s second largest urban region, after Metro Manila. With Cebu City as the main center of

commerce, trade and industry, it has become the main urban center of both the province and the

larger Visayas region. According to the 2015 Census of Population (POPCEN 2015), among the

barangays comprising Cebu City, Barangay Guadalupe is the most populous with a population

size of 61,238 persons.

For these reasons, the present study is pursued with the main purpose of determining the

efficacy of the law mandating for an increase in excise tax in the reduction of cigarette

consumption. This study aims to determine the influence of the increased excise tax in the

buying decision of the consuming public. If no significant influence exists, then the results of the

present undertaking aim to aid in the current flow of legislations in introducing other measures to

discourage the consuming public from buying cigarette products.

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 THE PROBLEM

Statement of the Problem

This study aims to determine if the Philippine government achieved its objective of

reducing cigarette consumption. Specifically, the research aims to answer the following

problems:

1. What is the sales volume of cigarettes sold by the Sari-sari stores at V. Rama Avenue,

Barangay Guadalupe, Cebu City before the implementation of TRAIN Law?

2. What is the sales volume of cigarettes sold by the Sari-sari stores at V. Rama Avenue,

Barangay Guadalupe, Cebu City under TRAIN Law?

3. Is there a significant decline on the consumption of cigarettes as envisioned by the

Philippine government in implementing the TRAIN Law?

Assumption/Limitation

1. The sales volume of cigarettes sold by sari-sari stores is a measure of cigarette

consumption.

2. The researchers limit the conduct of their study in V. Rama Avenue, Barangay

Guadalupe, Cebu City due to time constraints.

Statement of Hypothesis

There is no significant difference between the sales volume of cigarettes sold by the Sari-

sari stores at V. Rama Avenue, Barangay Guadalupe, Cebu City before and after the

implementation of TRAIN Law.

Significance of the Study

The results of this study will be of great benefit to the following:

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 PHILIPPINE GOVERNMENT. This study will inform the Philippine Government as

to public’s consumption of cigarettes and on how to generate and allocate sufficient revenues for

the expansion of health insurance coverage and through investments in health facilities and other

health programs by setting the minimum price floor of cigarettes.

COMMUNITIES. This study will benefit communities with similar issues by providing

a suggestion that might lead to a solution for its specific problems. The study could open

opportunities for such communities and could give them an idea for what seems to be not

feasible for them.

INDIVIDUALS. This study will benefit individuals who are interested in acquiring

additional knowledge and inputs on how to reduce usage of harmful products that can most

likely cause severe health problems, discourage individuals to indulge themselves in other vices,

and provide them with a concept or guide on how to make an effort to lead an active, health-

conscious lifestyle as possible.

FUTURE RESEARCHERS. This study will benefit future researchers by serving as an

opening for further studies and/or as a guide to widen their knowledge in specific area of study

or issue.

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 DEFINITION OF TERMS

The following terms should be defined as it is used in this study:

Cigarette. Refers to any roll or tubular construction, which contains tobacco or its derivatives

and is intended to be burned or heated under ordinary conditions of use.

Consumption. The using up or utilization of resources.

Descriptive research. A study designed to depict the participants in an accurate way. A survey

is a descriptive research.

Sales volume. The quantity or number of goods sold or services sold in the normal operations of

a company in a specified period.

Sari-Sari Store. A small retail outlet that can be found in almost all neighborhoods, sometimes

even in every street corner in the Philippines. Most sari-sari stores are privately owned shops and

are operated inside the store owner’s house. Commodities are displayed in a large screen-covered

or metal barred window in front of the shop.

Sin tax. A tax on items considered undesirable or harmful, such as alcohol or tobacco.

Respondents. This refers to the registered sari-sari store owners selling cigarettes at V. Rama

Avenue, Barangay Guadalupe Cebu City.

Tobacco. An agricultural crop, most commonly used to make cigarettes.

TRAIN Law. Republic Act No. 10963, otherwise known as the Tax Reform for Acceleration

and Inclusion (TRAIN) Act, will provide hefty income tax cuts for majority of Filipino taxpayers

while raising additional funds to help support the government’s accelerated spending on its

“Build, Build, Build” and social services programs.

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T-test. An analysis framework used to determine the difference between two sample means from

two normally distributed populations with unknown variances. A t-test is an analysis of two

populations means through the use of statistical examination; a t-test with two samples is

commonly used with small sample sizes, testing the difference between the samples when

the variances of two normal distributions are not known.

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 CHAPTER II

THEORETICAL BACKGROUND

Review of Related Literature

This chapter highlights the review of related literature concerning about smoking,

cigarettes and its consumption, Sin Tax Law before and after the implementation of the Tax

Reform for Acceleration and Inclusion (TRAIN) Law, and Barangay Guadalupe, Cebu City--

where the study will be conducted.

SMOKING

Cigarette smoking is one of the most common forms of recreational drug use. Smoking is a

practice in which a substance is burned and the resulting smoke breathed in to be tasted and

absorbed into the bloodstream(Trishayray, 2018)

Smoking also refers to the inhalation and exhalation of fumes from burning tobacco in

cigars, cigarettes and pipes. Historically, smoking as a practice, was followed by natives of the

Western Hemisphere, in religious rituals and for medicinal purposes. It has a history starting

from the late 1500s. Explorers of the New World saw it fit to introduce tobacco into Europe, in-

spite of the opposition from the then rulers. But the novelty and thrill factor won over many a

new user. Towards the end of the nineteenth century, cigarettes were higher in demand than the

cigars and pipes, which had been popular amongst smokers until then.

Tobacco smoke contains nicotine – a poisonous alkaloid – and other harmful substances like

carbon monoxide, acrolein, ammonia, prussic acid and a number of aldehydes and tars. Cigarette

7
smoke contains over 4,000 chemicals, including 43 known cancer-causing (carcinogenic)

compounds and 400 other toxins. (Trishayray, 2018)

Health reports giving definitive proof that cigarette smoking is a serious health hazard have

been submitted from time to time by the Surgeon General’s Advisory Committee on Health,

appointed by the U.S. Public Health Service. Findings include that a smoker has a significantly

greater chance of contracting lung cancer than a nonsmoker, depending on factors such as

number of cigarettes smoked daily, number of years the subject smoked and the time in the

person’s life when he or she began smoking.

Smoking is responsible for 71 percent of lung cancer deaths in the world. Consequently,

lung cancer is the leading form of cancer in the Philippines. DOH statistics reveal that 10

Filipinos die every hour because of smoking. According to the Department of Health (DOH), the

Philippines has an estimated 17.3 million tobacco consumers, the most number of smokers in

Southeast Asia. Filipinos on average consume 1, 073 cigarette sticks annually, while the smokers

in the region consume less than a thousand sticks yearly. This high consumption rate is seen as a

result, among others, of the very low cigarette prices in our country.

CIGARETTES

The term cigarette, as commonly used, refers to a tobacco cigarette but is sometimes used

to refer to other substances, such as a cannabis cigarette. A cigarette is distinguished from

a cigar by its usually smaller size, use of processed leaf, and paper wrapping, which is typically

white. Cigar wrappers are typically composed of tobacco leaf or paper dipped in tobacco extract.

(Rabinoff et al., 2007)

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 Cigarette refers to any roll or tubular construction, which contains tobacco or its

derivatives and is intended to be burned or heated under ordinary conditions of use.

Smoking rates have generally declined in the developed world, but continue to rise

in developing nations. Cigarettes carry serious health risks, which are more prevalent than with

other tobacco products, and nicotine is highly addictive. About half of cigarette smokers die of

tobacco-related disease and lose on average 14 years of life. Cigarette use by pregnant women

has also been shown to cause birth defects, including low birth weight, fatal abnormalities, and

premature birth. Second-hand smoke from cigarettes causes many of the same health problems as

smoking, including cancer, which has led to legislation and policy that has prohibited smoking in

many workplaces and public areas. Cigarette smoke contains over 7,000 chemical compounds,

including arsenic, formaldehyde, cyanide, lead, nicotine, carbon monoxide, acrolein, and other

poisonous substances. Over 50 of these are carcinogenic. Additionally, cigarettes are a frequent

source of mortality-associated fires in private homes, which prompted both the European

Union and the United States to ban cigarettes that are not fire-standard compliant from 2011

onwards. (Rabinoff et al., 2007)

Cigarette sales are a significant source of tax revenue in many localities. This fact has

historically been an impediment for health groups seeking to discourage cigarette smoking, since

governments seek to maximize tax revenues. Furthermore, some countries have made cigarettes

a state monopoly, which has the same effect on the attitude of government officials outside the

health field. Higher prices for cigarettes discourage smoking. Every 10% increase in the price of

cigarettes reduced youth smoking by about 7% and overall cigarette consumption by about 4%.

Thus, increased cigarette taxes are proposed as a means to reduce smoking. States charge sizable

settlement payments to tobacco companies, and the federal government levies user fees to fund

9
FDA regulatory measures over tobacco. While these charges are not cigarette-specific, tobacco

companies are ultimately forced to pass on those costs to their consumers. Lastly, most

jurisdictions apply sales tax to the full retail price of cigarettes. The World Health Organization

(WHO) recommends that globally cigarettes be taxed at a rate of three-quarters of cigarettes sale

price as a way of deterring cancer and other negative health outcomes. (Rabinoff et al., 2007)

The Philippines is one of the largest consumers of tobacco in the Western Pacific Region

with over 19 million smokers. Nearly 30% of Filipinos consume some type of tobacco product

— 47.7% of men smoke while 9% of women smoke. Youth tobacco use is a significant problem

in the Philippines; nearly 23% of 13–15 year olds use tobacco products. High rates of tobacco

use contribute to a significant number of early deaths and high healthcare costs. In the

Philippines, tobacco use is estimated to kill approximately 87,600 people each year — about 240

every day. The economic costs of smoking in the Philippines were over 7% of GDP in 2003. As

much as 44.6 billion pesos (US$ 858 million) was spent to treat the four major diseases caused

by tobacco use while the morbidity and mortality caused by tobacco use resulted in lost

productivity of nearly 270 billion pesos (US$ 5.2 billion). The Current Tobacco Tax Structure in

the Philippines is Complex. The Philippines levies an excise tax and a value added tax on

tobacco products. The excise tax system has multiple tiers, with some brands bearing a tax that is

less than one-tenth of the tax per pack levied on other brands. The “price classification freeze”

applied in 1996 mandates that the tax applied to most brands is based on their net retail price in

1996 rather than the current price. (Quimbo et al., 2012)

Supply of Tobacco andTobacco Products in thePhilippines

The Philippines has long been a major tobacco growing country, beginning with the

introduction of the tobacco plant by Spanish colonists in the 16th century. As a result, tobacco

10
has a significant place in the country’s history, economy, and politics. Most tobacco farming is

concentrated in 5 provinces. Over 60% of the tobacco grown in the Philippines is Virginia

tobacco, with burley tobacco the next most common (24.2%). The Philippines is a net exporter of

tobacco leaf, with half or more of tobacco production exported in recent years. In 2010, the two

largest cigarette manufacturers in the country, Fortune Tobacco Corporation (FTC) and Philip

Morris Philippines Manufacturing Incorporated (PMI) formed a joint venture, creating a near

monopoly on cigarette manufacturing. British American Tobacco left the Philippine cigarette

market in 2009, but a variety of other local and international tobacco companies continue to have

a presence in the Philippines, including Japan Tobacco International (JTI), Mighty Corp, La

Suerte Cigar & Cigarette Factory, and Imperial Tobacco. This section briefly describes the

supply side of the tobacco leaf and tobacco product markets in the Philippines, highlighting

recent changes in these markets. (Quimbo et al., 2012)

Tobacco Control in the Philippines

In addition to the substantial public health casefor tobacco control, a strong economic

rationale exists for government intervention to reduce tobacco use. (Quimbo et al., 2012)

Rationale for Government Intervention

The notion of consumer sovereignty — the principle that an individual makes the best

choices for himself or herself – depends on two key assumptions: that an individual fully

understands the costs and benefits of these decisions and that an individual bear all of the costs

and receives all of the benefits of his or her decisions. Tobacco use clearly violates both of these

assumptions, resulting in market failures that justify government intervention. In general,

consumers have imperfect information about the health and other consequences of tobacco use.

Many users do not fully understand the health hazards associated with tobacco use, and those

11
who do have a general understanding of the risks do not adequately internalize these risks. This

is particularly true in the Philippines, where many smokers are less than fully aware of the health

consequences of smoking. For example, while 92.7% of Filipino smokers believe smoking

causes lung cancer, only 75.7% were aware that smoking causes heart attacks and 69.2% were

aware that smoking causes strokes. This imperfect information is complicated by the fact that

most tobacco users initiate use as youths. As noted above, millions of Filipino youth begin using

tobacco by age 15, with many starting at younger ages. More than half of Filipino youth are

exposed to tobacco smoke at home and nearly two-thirds are exposed in public places. Similarly,

more than half of adult Filipinos are exposed to tobacco smoke at home and on public

transportation, while more than one third of Filipino workers are exposed in the workplace.

Additionally, there are financial externalities that result from publicly financed health care to

treat diseases caused by tobacco use. Filipinos are covered by the government through the

PhilHealth program. A more recent strand of literature has emphasized a different type of market

failure, the “internalities” that arise as consequences of time inconsistencies in preference.

(Quimbo et al., 2012)

Tobacco Control Policy in the Philippines

A variety of tobacco control policies and programs can be used to address the failures

inherent in the markets for tobacco products. The WHO’s Framework Convention on Tobacco

Control (FCTC), the world’s first public health treaty, calls for governments to adopt

comprehensive policies to curb tobacco use. The public transportation, more than one-quarter of

adults’ report being exposed in government buildings, and 36.9% report being exposed in the

workplace (including 13.9% exposed in workplaces that prohibit smoking in enclosed areas).

R.A. 9211 mandated health warning labels on tobacco product packaging, calling for rotating

12
text warnings in English or Filipino that take up 30% of the front of the pack. The warnings

provide general statements about the health consequences of tobacco use, stating that: “cigarette

smoking is dangerous to your health”; “cigarettes are addictive”; “tobacco can harm your

children”; and “smoking kills.” Efforts to adopt legislation that would strengthen the warnings by

requiring larger, rotating graphic warnings have been unsuccessful. This led the Department of

Health to adopt an administrative order in 2010 requiring graphic warning labels in order to

comply with the WHO FCTC (The World Health Organization Framework Convention on

Tobacco Control). This administrative order was immediately challenged by the tobacco industry

and graphic warnings labels are currently on hold. The general nature of the existing text

warnings, along with the frequent purchases of single cigarettes, likely contribute to the less than

full understanding about the specific risks from tobacco use among Filipino smokers described

above. Other public education efforts, including mass-media campaigns to inform smokers of the

risks from smoking, are spotty at best and have limited reach among the least educated and

lowest income Filipinos. (Quimbo et al., 2012)

R.A. 9211 also banned most tobacco product advertising, including on television and

radio, in print, and outdoors, as well as tobacco company sponsorship of events, as of 1 July

2008. However, point-of-sale advertising is allowed, as are promotions and sampling to Filipinos

over 18 years of age. Despite the somewhat comprehensive ban, the vast majority of Filipinos

reported being exposed to tobacco company advertising in 2009, with 71.2% reporting exposure

to any cigarette advertising. The exemption of the point Philippines signed the FCTC on 23

September, 2003, and ratified the treaty less than two years later, on 6 June, 2005. As with many

low and middle-income countries that have signed and ratified the treaty, tobacco control

policies in the Philippines fall short of those called for by the FCTC. (Quimbo et al., 2012)

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 However, these policies have become increasingly comprehensive since the early 1980s

and the country’s ratification of the FCTC suggests that this trend will continue in coming years.

The Economics of Tobacco and Tobacco Taxation in the Philippines of-sale from the

advertising ban accounts for much of this, with 53.7% of individuals surveyed reporting noticing

advertising in stores. Similarly, the exemption for promotions to those over 18 is also important,

with 29.1% reporting noticing cigarette promotions. The sale of tobacco products to persons

under 18 years of age was also prohibited by R.A. 9211. However, minors have little trouble

purchasing cigarettes, with nearly half (49.3%) of 13-15 year olds reporting buying cigarettes in

stores and 59.6% of those who buy cigarettes in stores not being refused sale because of their

age. The numerous small tobacco product vendors, particularly the sari-sari stores and street

vendors, make effective enforcement of the prohibition on sales to minors nearly impossible.

(Quimbo et al., 2012)

The Philippines has a national tobacco control strategy and, in 2010, created a National

Tobacco Control Coordinating Office, based in the Department of Health’s National Centre for

Health Promotion. Resources, however, are limited. Cessation programs are available, but tend

to have limited reach and there are no national cessation practice guidelines or models. There is

no national quitline to support cessation and only limited availability of pharmacotherapies,

including nicotine patches and varenicline, and these medications are not on the essential drug

list. Evidence from high-income countries and a growing number of low and middle-income

countries demonstrates that strong tobacco control policies will lead to significant reductions in

tobacco use, while relatively weak policies will have a limited impact at best. To date, the

Philippines’ partial and uneven restrictions on tobacco company marketing, incomplete

restrictions on smoking in public places and workplaces, weakly enforced ban on sales to minors,

14
limited efforts to raise awareness about the consequences of tobacco use and minimal resources

dedicated to tobacco control appear to have had little effect on tobacco use, with smoking

prevalence changing little over time, even as policies have become somewhat more

comprehensive. Stronger and more comprehensive policies would complement higher taxes in

reversing the upward trends in tobacco use in the Philippines. (Quimbo et al., 2012)

NATURE OF CIGARETTES

Consumers’ goods are those final goods which directly satisfy the wants of consumers.

Such goods are bread, milk, pen, clothes, furniture, etc. Consumers’ goods are further sub-

divided into single-use consumers’ goods and durable use consumers’ goods. These are goods

which are used up in a single act of consumption. Such goods are foodstuffs, cigarettes, matches,

fuel, etc. They are the articles of direct consumption because they satisfy human want directly.

Cigarette is considered as single use consumer goods as they are consumed immediately

and once for all.

Cigarette is also considered as a demerit good. A demerit good is defined as a good

which can have a negative impact on the consumer – but these damaging effects may be

unknown or ignored by the consumer. Demerit goods also usually have negative externalities –

where consumption causes a harmful effect on a third party. The classification of demerit goods

is a normative judgement. In defining demerit goods, we may assume that people are irrational

and make poor choices – often consuming goods which are harmful, degrading or damaging in

the long-term. This may be due to poor information or poor decision making. In other words,

people may underestimate the private costs and over-estimate the private benefits. (Pettinger,

2016)

15
EFFECTS OF QUITTING SMOKING

Quitting smoking means breaking the cycle of addiction and essentially rewiring the brain to

stop craving nicotine.To be successful, smokers that want to quit need to have a plan in place to

beat cravings and triggers.The benefits of quitting smoking begin in as little as 1 hour after the

last cigarette.The sooner a smoker quits, the faster they will reduce their risk of cancer, heart and

lung disease, and other conditions related to smoking. (Fletcher, 2017)

Smoking is a harmful habit that can lead to severe health complications and death. When a

person quits smoking, the body will start to naturally heal and regain the vitality of a non-smoker

over time.

Some effects, such as lowered blood pressure, are seen almost immediately. Other effects,

such as risks of developing lung cancer, heart disease, and lung disease, take years to drop down

to the levels of a non-smoker.

However, each year of not smoking decreases risks and improves overall health, making

quitting smoking an excellent choice for anyone who started the habit. (Fletcher, 2017)

Quitting smoking now greatly reduces your risk for numerous diseases, cancers, COPD, and

reproductive complications. When quitting smoking, there are numerous physical and emotional

effects the body experiences.

SIN TAXES

A sin tax is a state-sponsored tax that is added to products or services that are seen as

vices, such as alcohol, tobacco and gambling. These types of taxes are levied by government,

intending to discourage individuals from partaking in such activities without making the use of

16
the products illegal. (Evan, 2010). Also, these taxes provide an easy way for the government

to boost revenue. (Miller, 2017)

Unlike other taxes, however, sin tax is often enacted with the additional aim of reducing

or eliminating the public’s consumption of a particular product. The sin tax accomplishes this

purpose, as higher costs through taxation encourage consumers to spend less on harmful

products.

House Bill 5727, or the Sin Tax Bill, aims to restructure the existing taxes imposed on

alcohol and tobacco goods. Duties on these products are a potential revenue source that will help

fund the Universal Health Care Program of the administration in simplifying the current excise

tax system on alcohol and tobacco products and fixing long standing structural weaknesses, and

by addressing public health issues relating to alcohol and tobacco consumption. (Department of

Finance, 2018)

Likewise, higher taxes—and consequently higher costs—are seen as a deterrent to the

consumption of “sin” products, whose adverse effects are mostly borne by the poorer segments

of society.

SIN TAX REFORM IN THE PHILIPPINES

The Philippines’ sin tax reform—a significant simplification and increase in tobacco and

alcohol excise taxes, and the earmarking of revenue increases to fund universal health care—

exemplifies how the nation seized a rare opportunity to make a decisive and tangible difference

in the lives of millions of Filipinos, against the odds.

Before the passage of Republic Act 10351, or the Sin Tax Reform Act of 2012,

restructuring excise taxation of tobacco and alcohol in the Philippines was a protracted crusade

17
against powerful vested interests that had long benefited from the old system’s inefficiencies.

Previous efforts languished in the hands of those opposed to change, and the merits of reform

were lost to private profit at the expense of the people’s welfare.

The Department of Finance and the Department of Health stood side by side in pushing

for and defending the sin tax reform as a public health measure that promised fiscal returns.

Development institutions including the World Bank Group and the World Health Organization

provided us with analytical support and international experience to bolster the technical bases of

our proposal. Civil society groups—the “white armies” of the medical community, economic

reform activists, and tobacco control and health advocates—mobilized to publicize information

on the sin tax reform. These actions, both spontaneously and proactively coordinated, were so

sustained that even parties who felt that sin tax reform was not in their short-term interest were

brought into the dialogue and became convinced that the reform will serve the greater good.

Under the Sin Tax Reform Act, the excise tax on cigarettes will plateau in 2017 following

four years of progressive increases. Cigarettes will then be taxed at a single unitary rate with

annual increases of 4 percent. Although this ensures an automatic upward adjustment in the

excise tax, it may not be sufficient to keep pace with the increasing real incomes of Filipinos,

who have enjoyed years of sustained economic growth.

With implementation of the World Health Organization (WHO) Framework Convention

on Tobacco Control included as a target in the Sustainable Development Goals (SDGs) for 2030,

the government and development partners will be eager to learn the lessons of the sin tax reform

in the Philippines. Improving health and well-being are very much at the heart of the post-2015

development agenda, and excise taxes, starting with tobacco, can be a way for all countries, at

whatever level of development, to finance some of the SDGs.

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SIN TAX LAW OVERVIEW

The 2012 Philippines Sin Tax Law (STL) brought about long-overdue reforms to tobacco

and alcohol taxation to promote better health, improve financial sustainability, and good

governance. The STL greatly simplified and increased excise taxes, especially on cigarettes. In

2012, cigarettes were widely sold at ₱1 apiece or even less—an amount equivalent to a couple of

U.S. cents. Falling real taxes and growing incomes in the Philippines meant that tobacco and

alcohol products were widely accessible and affordable. The prevailing excise regime had

resulted in a significant decline in revenues, from 0.9 percent of gross domestic product (GDP)

in 1997 to under 0.5 percent of GDP in 2012. This is equivalent to “losses” of over $2.5 billion

per year in 2012 terms. The excise regime granted special low grandfathered rates to certain

cigarette producers, suffered from a lack of inflation indexing, and fostered an increasingly

monopolistic market. The multiple excise tiers—which varied by price—created the temptation

for downshifting (reclassification) to lower price tiers to avoid taxes.

The STL raised and simplified tobacco and alcohol excises, increasing government

revenues and reducing smoking. After only one year of implementation, excise tax collections

from tobacco and alcohol products shot up to approximately ₱103.4 billion ($2.44 billion), an

increase of more than 86 percent from the previous year’s collections of ₱55.7 billion ($1.25

billion). In 2015, total sin tax collections reached ₱141.8 billion (over 1 percent of GDP), with

tobacco accounting for ₱100 billion. Retail prices for cigarettes increased significantly because

of the reform, prompting consumers to cut down and even stop smoking, with early data

suggesting some declines in smoking prevalence.

The reform scaled up health care financing, nearly doubling the Department of Health’s

(DOH) budget in its first year of implementation and financing the extension of fully subsidized

19
health insurance to the poorest 40 percent of the population. From 2013 to 2014, the number of

poor and near-poor families enrolled in the National Health Insurance Program increased from

5.2 million to 14.7 million. This grew to 15.3 million by end-2015, almost tripling the coverage

of the poor and near-poor. Sin tax revenues were also subsequently used to subsidize the

insurance coverage of senior citizens, further expanding access to care among the vulnerable. By

2016, the DOH budget was triple its 2012 level (in nominal terms), reaching ₱122.6 billion.

Although the initial impact of the STL was felt immediately, it is a multiyear transition to

a new tax regime, and its full implementation stretches to 2017 and beyond. By 2017, all

cigarettes will be subject to a single unitary excise tax of ₱30 ($0.70) per pack after a

quadrupling of the lowest excise tax tier of ₱12 in 2013 from ₱2.72 in 2012. After 2017 the

excise tax will be increased automatically by 4 percent per year. Higher cigarette prices should

improve population health by curbing smoking. The STL retained revenue earmarking for

tobacco-growing regions (almost equal to 15 percent of tobacco revenues), with a major increase

in these transfers slated for 2015, based on 2013 revenue realizations.

The Sin Tax Law’s Key Features

The law simplified and increased excise taxes on cigarettes. It did away with complex tax

tiers and rates that catered to a narrow set of special interests. It helped set a floor price for all

brands of cigarettes, raising the minimum tax more than fourfold (341 percent) from 2012 levels

of only ₱2.72 ($0.06) per pack of 20. It also moved from a multitiered ad valorem system to a

specific structure with only two tiers, converging to a unitary rate over four years. This did away

with the administrative difficulties of classifying cigarettes by declared value and allowed the

Bureau of Internal Revenue (BIR) to focus on more easily observed volumes. To counter risks of

tax evasion and smuggling, the BIR also introduced a holographic tax security stamp in 2014.

20
Simplicity and transparency served good governance and tax administration. It is expected that

by 2016, floor prices for an individual cigarette will increase further to ₱2 ($0.04). Spirits and

beer taxes were also simplified, but the increases were less than for cigarettes.

The STL contributed to attaining universal health coverage. This was done through the

expansion of health insurance coverage and through investments in health facilities and other

health programs; and accompanied by improved targeting, accountability, and transparency

mechanisms. The STL’s incremental revenues, net of allocations to tobacco-producing regions,

are reserved for the government’s health program. Of this, 80 percent is allocated to universal

health care and, specifically, the National Health Insurance Program, health-related Millennium

Development Goals, and health awareness programs. The remaining 20 percent goes to the

DOH’s Medical Assistance Program, which deposits funds at hospitals to cover the medical bills

of patients who cannot afford to pay, and the DOH’s Health Facilities Enhancement Program

(HFEP), which funds additional infrastructure investments in underserved areas. The National

Health Insurance Program share is transferred from the DOH to the Philippines Health Insurance

Corporation, known as PhilHealth, a Government-Owned and/or Controlled Corporation,

effectively providing free health insurance to the poorest 40 percent of the population (currently

at a premium/subsidy of ₱2,400, or $55, per family). Importantly, beneficiaries are identified

using the National Household Targeting Survey for Poverty Reduction, a targeting list originally

designed for the government’s conditional cash transfer program. This ends the practice of

leaving the targeting of the poor to the discretion of local government units and replaces it with a

national entitlement and transparent targeting.

Setting clear objectives, principles, and non-negotiables was an important part of

anchoring the strategic choices made in finalizing the bill. These included (1) significant

21
streamlining of the excise tax structure (that is, converging to a unitary rate for cigarettes); (2)

setting a minimum floor tax for cigarettes to discourage smoking; (3) ensuring a level playing

field for producers; (4) generating sufficient revenues to scale up universal health care, notably

for the bottom 40 percent of the population; and (5) ensuring that the reform as a whole was pro-

poor. Expenditure decisions focused on earmarking specifications (that is, for what and how

“hard”), and whether the STL would generate sufficient revenues to finance universal health care

in both the short and medium term.

Monitoring the Implementation of the Sin Tax Law

The first three years of implementation of the STL have been a success. Of particular

note is that (1) prices of the cheapest brands of cigarettes have increased by more than 50

percent, (2) total revenues have increased, (3) holographic tax stamps are now on over 95 percent

of packs, (4) the BIR has taken legal action to address concerns of tax evasion in the sector, and

(5) smoking prevalence has fallen. On the expenditure side, the DOH’s health budget has tripled

in three years and the poorest 40 percent of the population, as well as senior citizens, receive free

health insurance. (Kaizer et al., 2016)

SIN TAX FOR HEALTH

According to the Department of Health (DOH), the Philippines has an estimated 17.3

million tobacco consumers, the most number of smokers in Southeast Asia. Filipinos on average

consume 1, 073 cigarette sticks annually, while the smokers in the region consume less than a

thousand sticks yearly. This high consumption rate is seen as a result, among others, of the very

low cigarette prices in our country.

22
 According to the DOH, a 10 percent increase in tobacco taxes will reduce the number of

smokers by two million by 2016. A significant decline in the number of smokers will likewise

reduce the number of smoking-related deaths.

SIN TAX FOR REVENUE

The Department of Finance (DOF) has determined the following flaws in the current system of

taxing sin products:

 The current system is still under the Price Classification Freeze, wherein old brands are

taxed differently from new ones.

 The system follows a multi-tiered tax structure that is prone to the downshifting of

smokers to cheaper cigarette brands (which does not discourage smoking). For example,

based on 1994-2010 statistics provided by the Bureau of Internal Revenue (BIR), it was

observed that consumers had downshifted from medium-priced cigarettes (more than

30% consumption in 1994 to less than 20% in 2010) to low-priced cigarettes (less than

40% consumption in 1994 to more than 50% in 2010).

 The lack of price indexation results to declining tax burdens, as tax is eroded by inflation.

In effect, the 2004 effective burden tax price has decreased in 2010 ranging from a 1

percent to 9 percent decrease in tax burden (based on BIR 4th quarter survey).

The sin tax proposes the following reforms:

 Maintain the specific form of excise taxation (e.g., per piece, per pack, per proof liter) to

discourage consumption, have more revenues that are predictable and easier to

administer, and devoid of incentives for manufacturers and importers with under-invoice

products;

23
  A shift from a multi-tiered tax structure to a single tax structure: (1) For cigarettes, a two-

rate structure of P14 and P30 per pack for the 1st two years, and a uniform rate of P30 per

pack of cigarettes on the third year.

 Adopt an automatic annual adjustment of tax rates using relevant NSO-established

tobacco and alcohol indexes after the third year.

 Revenues from sin taxes are to augment the funds of the Aquino administration’s

universal health care program.

 The continued sharing with tobacco farmers of the incremental revenues.

SIN TAX FOR UNIVERSAL HEALTH CARE (UHC)

Additional revenues to be brought about by the proposed sin tax reform are being viewed as

one of the main sources for UHC national government financing. P92.7 billion will account for

the national government covering for a 100 percent subsidy for the premium of 5.2 million or the

bottom 20 percent of the poorest families. P55.3 billion will account for a 50 percent subsidy for

the next 5.6 million of poorest families (the other half will be funded by the local government)

and P76.8 billion will account for investment subsidies in the health sector.

CIGARETTES MORE AFFORDABLE DESPITE SIN TAX LAW

Republic Act No. 10351, more commonly known as the sin tax law, which aimed to curb

the incidence of smoking in the country, by making cigarettes more expensive through higher

taxes on cigarette manufacturers. Yet, the law has not prevented people from smoking, because

cigarettes remain affordable and are likely to become more so in the future.

24
 A deeper look into the law explains this seeming contradiction and reveals the policy

areas that need improvement, if the sin tax law is to be truly effective. R.A. No. 10351 targets the

relatively poorer segments of the population, who smoke more than the middle or upper classes.

“There are differences across socio-economic status, at least in the Philippines,”

explained Valerie Gilbert Ulep, research specialist at the Philippine Institute for Development

Studies (PIDS). “You have higher prevalence of smoking among the poor.”

The differences are noted in a report on smoking published by the World Health

Organization in 2008, which found that poor households with members who smoked spent more

than eleven times for tobacco products than for health, and nine times more than for education.

“Tobacco is inextricably linked with poverty,” the report said. “Evidence from around the world

has shown that tobacco consumption is higher among the poorest households,” the report noted,

adding that expenditures on tobacco products “divert scarce resources that poor families might

have spent on food instead.”

A World Bank study notes that there are more barriers for the poor to cease smoking,

such as “lower awareness and concern about health risks.” A study by the US National Center

for Biotechnical Information cites exposure to stress, noting that smokers who live in stressful

environments, like those from lower incomes, “view smoking as a comfort enabling them to

cope." The same study also notes that the poor smoke more because of targeted marketing by

tobacco companies, especially to those with lower socio-economic backgrounds “who are less

willing to make choices for future gain.”

There is broad consensus in these and other studies that the poor are more affected by

changes in the prices of goods than the rich. And so, if cigarette prices go up, those with less

money might be forced to reduce their consumption.

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 The problem, however, is that while the current sin tax law has raised cigarette prices, the

increase is not high enough. “I did a projection of tobacco prices in the future. Taking into

account the economic growth and inflation rate, tobacco prices will still go down,” Ulep said.

The Philippine economy, measured by its gross domestic product (GDP), has grown in

the last few years. Thus, the GDP per person, or simply the total GDP divided by the total

population, has also increased. While an increasing GDP per person does not always mean every

Filipino has become well off, it does suggest that incomes, on the average, have been increasing.

“When you have a growing economy, household income also increases so your

disposable income is also higher,” said Ulep. And this presents a challenge for the effectiveness

of the sin tax law, because the increase in the prices of tobacco products is eroded by the increase

in income, defeating the purpose of the sin tax law. (Soriano et al., 2017)

THE NEED FOR TOBACCO TAX REFORM IN THE PHILIPPINES

According to a white paper by WHO Philippines (2009), current tax structures have

mandated a steadily increasing tax on tobacco products since 1997, and yet smoking prevalence

among Filipinos has continued to rise over the last decade.

Taxation should curb tobacco use, studies and models around the world have proven. In

the Philippines, however, such is not the case.

Raising taxes on tobacco products has long been encouraged by the World Bank, World

Health Organization, and tobacco control experts, as a proven tobacco control measure. The

WHO Framework Convention on Tobacco Control (FCTC), a global treaty to which the

Philippines is party, says that raising the price of tobacco through higher taxation is the single

most effective way to reduce consumption and encourage tobacco users to quit. Article 6 of the

26
FCTC in particular says that higher taxes deter tobacco use among the young and the poor, and

helps all other demographics of smokers to give up the deadly habit.

Studies all over the world suggest that a 10 percent increase in tobacco taxes can bring

down tobacco consumption by as much as 8 percent, particularly in developing countries. A tax

increase should also directly benefit governments through increased revenues, which can in turn

be used for tobacco control and other important health and social programs. It is therefore

recommended by the FCTC and the World Bank that all governments increase tobacco taxes to

at least 65 percent of the retail price of tobacco products.

In the Philippines, however, something seems amiss. Current tax structures have

mandated a steadily increasing tax on tobacco products since 1997, and yet smoking prevalence

among Filipinos has continued to rise over the last decade. What’s gone wrong? Why is the tax

program on tobacco not having the effect of reducing tobacco use in the country? The problem

does not lie with the link between taxation and tobacco use, which has been proven time and

again in documented models worldwide. What needs reexamination in Philippine tobacco control

efforts are the laws and tax structures themselves. The theory is sound, but the application

appears to have been compromised, such that the prevailing system has been rendered ineffective

with respect to bringing down tobacco consumption. For starters, even with programmed

adjustments in tobacco taxes, the current tax rates on Philippine tobacco are nowhere near the

levels recommended by the World Bank. The reason we are off track and off target, apparently,

is that the crafting and implementation of tobacco taxes in the country have been influenced too

heavily by industry interests, and what the Philippines therefore has is not necessarily what the

World Bank, WHO, and global experts on tobacco control have been meaning to encourage.

Indeed, there is new evidence to suggest that the existing tax laws applying to the tobacco

27
industry may actually be aggravating and complicating the national tobacco control effort. On

the other hand, the same new comprehensive study that suggests weaknesses in the current tax

laws on tobacco, also provides compelling arguments that sound, scientific adjustments in the

laws may yet turn the odds back in favor of public health objectives. The Philippines may yet fix

the tax structures on tobacco products, and achieve the kind of results the world is seeing in

tobacco control.

INEFFECTIVE LAWS AND TAX STRUCTURES IN THE PHILIPPINES

As tobacco-control tools, the laws and tax structures on the Philippine tobacco industry

need fixing. They are failing to reduce tobacco consumption, and worse, they are creating other

problems. To be precise, an in-depth analysis of the current tax structures on tobacco suggest that

they are:

 strengthening a national tobacco oligopoly—comprised of three major tobacco producers

that control 99 percent of Philippine market. This oligopoly is in turn exploiting and

undermining public policy through lobbies, political pressure, and outright corruption.

 encouraging smokers to merely switch brands, rather than quit smoking. Indeed, there is

evidence that the flawed tax structures are actually encouraging more tobacco use.

 distorting the real market prices of tobacco products, undervaluing the same so as to

lower actual tax contributions, and thus depriving government of lost potential revenue.

 confusing the focus and objectives of tobacco taxation itself. The current tax systems

distract from what ostensibly is the ultimate value behind tobacco taxation, which is,

supposedly, tobacco control as a public health.

28
 As already suggested above, tobacco tax structures in the Philippines appear to have been

designed and implemented with the interests of an oligopoly highest in mind. A second value

recognizes the potential contributions of the tobacco industry to national coffers by way of taxes,

and then the supposed value of the industry to the national economy as a whole. Public health

interests, sadly, appears low among the intended benefits of the tax structures.

There are three major cigarette manufacturers in the Philippines: Fortune Tobacco

Corporation (FTC), Philip Morris International (PMI), and La Suerte. These three companies

have a combined market share of 99 percent. FTC dominates the industry with a 61 percent share

of the market, and produces four of the top five brands, including the top two leaders, Champion

and Fortune International. PMI comes in as a far second. With nearly the entire market

controlled by an oligopoly, the three manufacturers easily control the market prices of cigarettes,

and they have plainly influenced tobacco tax policy-making.

In truth, however, tobacco taxes are structured in such a way as to not really discourage

smoking. At best, they affect brand loyalty among current smokers, and at worst, they merely

strengthen the existing dominant players in the tobacco industry.

In 2003, taxes as a share of gross retail prices were about 11-43 percent (depending on

the cigarette type); with the stipulated tax increases in 2005, the tax share increased to 21-49

percent. If we adjust for market-determined NRPs, excise taxes would actually only be about 19

to 36 percent of the price that smokers actually pay. Whichever way one looks at it, tobacco tax

in the country is considerably lower than the 65 percent share recommended by the World Bank.

It is important to abandon this current tax setup, and to come up with an alternative

taxation scheme. Government must consider a substantial and fixed tax raise for all tobacco

products, meeting the minimum 65 percent rate recommended by the World Bank, and applying

29
this across all categories, while allowing for inflation and market forces to determine actual retail

prices. When such adjustments are made, simulations show much more significant impacts of

tobacco taxes on tobacco consumption.

Measly increase in tobacco tax in TRAIN to increase number of smokers in PH

A regional anti-smoking alliance warned of a possible spike in the number of smokers in

the country after Congress failed to pass a higher tobacco tax as part of a key tax reform bill.

Congress approved on Wednesday Package 1 of the Tax Reform for Acceleration and

Inclusion (TRAIN) which lowers income taxes, while raising excise taxes on a number of items.

However, despite lobbying from health advocates and lawmakers, the TRAIN bill merely

incorporated a meager P2.50 ($ 0.05) excise tax on tobacco. This means a pack of cigarettes

which now costs P30 ($0.60), will cost P32.50 from January until June 2018, then P35 until

December 2019, P37.50 until 2021, then P40 until 2023, with an increase in tax of four percent

annually from 2023 onwards.

"The very small tax increase is both alarming and unsatisfactory because it is totally

inadequate to further discourage youth from smoking and to generate revenues to finance the

expanded universal health care in the medium to long-term," said SopaphanRatanachena,

Tobacco Tax Program Manager of the Southeast Asia Tobacco Control Alliance (SATCA) in

Bangkok.

The alliance called on President Rodrigo Duterte to veto the tobacco excise tax before he

signs the TRAIN bill into law. The tobacco excise tax is in "package 1" of the tax reform bill,

which is expected to take effect January 2018 and generate P130 billion in revenues.

SATCA is a multi-sectoral alliance supporting Association of Southeast Asian Nations

members in their tobacco control policies.

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Up to 10 percent tobacco tax proposed

During Senate deliberations on the bill, there were moves to more than double tobacco

taxes to 10 percent annually. This should result in additional P50 billion ($1 billion) in revenues

and at the same time force more than 1.5 million smokers to kick the habit, said Senator

RisaHontiveros, vice chair of the Committee on Health and Demography.

Another anti-smoking lobby group, Health Justice Philippines, proposed "at least" a 60

percent hike in tobacco tax by 2018, with a subsequent rise of nine percent annually.

"To our legislators, please think of the 200,000 more Filipinos who will fall prey to

smoking every year if we fail to increase the tobacco tax by at least 60 percent in 2018, and by at

least nine percent yearly thereafter. There is no more time to waste. Lives are on the line," said

Mary Ann Fernandez Mendoza, president of Health Justice.

Republic Act 10351 or the Sin Tax Reform Law of 2012 raised tobacco tax by four

percent per year. At the outset, the law was seen as a significant deterrent to smoking, and it

reduced smoking among the youth and the poor. It also generated revenues, part of which went

to health coverage for the poor.

But economists have said the four percent tax is not enough to discourage tobacco

consumption because the health gains are eclipsed by inflation.

"To sustain the reduction in tobacco use, cigarette tax should be increased immediately

from its current rate of 30 pesos per pack to at least 60 pesos per pack," said Ratanachena. The

regional coalition also cited the same figure as Health Justice, stating that "every year of delay

has been estimated to result in 200,000 more smokers, who will be at high risk of smoking-

caused diseases, disabilities, and early death."

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Increasing tobacco tax generates big revenues

In the Philippines, 240 people die every day from smoking-related diseases, said Health

Justice.

The group cited Bureau of Internal Revenue statistics that showed tobacco excise tax

collection in 2016 amounted to P163.5 billion, even as smoking set the economy back by P204

billion in 2015 due to illnesses from smoking, and lost productivity due to absences.

Increasing tobacco taxes regularly is one of the most practical and cost-effective ways to

reduce tobacco use and save lives, health advocates and the World Health Organization (WHO)

have said. The Philippines is one of 181 states that has committed to the global tobacco control

treaty or the WHO Framework Convention on Tobacco Control.

Prior to the passage of the tax reform bill, tobacco growers and farmers lobbied

lawmakers not to increase the tobacco excise tax which they considered "exorbitant." The

National Tobacco Administration cited the fall in tobacco production to 52 million kilograms

(kg) in 2015 from 68 million kg in 2013. It also said that 9,232 tobacco farmers left the trade in

2015 alone. (Parpan, 2017)

The higher excise tax rates slapped on “sin” products such as cigarettes at the start of the

year pushed inflation faster in February to possibly hit a fresh over three-year high of 4.1

percent, the Department of Finance said.

“Food and non-food commodities alike see their respective rate of price increase

relatively unchanged while those of sin products may have likely accelerated. The latter may be

explained partly by price increase due to sin tax hikes and partly by the appropriate price

adjustments of Mighty Corp. following its paying the right amount of taxes,” DOF

Undersecretary and chief economist Gil S. Beltran said in an economic bulletin.

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 A headline inflation of 4.1 percent year-on-year will be the fastest since the 4.3 percent

posted in October 2014.

Under Republic Act No. 10963 or the Tax Reform for Acceleration and Inclusion

(TRAIN) Act, the unitary excise tax slapped on cigarettes rose to P32.50 per pack effective Jan.

1 from P30 a pack last year.

The TRAIN Law also mandated a further increase in the cigarette excise tax rates to P35

per pack from July 1, 2018 to Dec. 31, 2019; P37.50 a pack from Jan. 1, 2020 to Dec. 31, 2021;

and P40 from Jan. 1, 2022 to Dec. 31, 2023.

Finance Undersecretary Karl Kendrick T. Chua earlier said that the 4-percent average

rate of increase in prices of basic goods last January was due to “better compliance in tobacco

tax.”

“Tobacco inflation was 17.4 percent in January when the expected increase is only 8

percent due to the scheduled tobacco tax increase. Since profiteering is unlikely, the remaining

reason is that Mighty under Japan Tobacco is now paying the right tax, and thus is charging

higher prices for cigarettes,” Chua had explained.

“This is corroborated by Bureau of Internal Revenue data which showed monthly

collection up by around P1.5-2 billion. In fact, if Mighty continued to evade tax and therefore

cigarette prices remain low, overall inflation would have gone down to around 3.75 percent,”

according to Chua.

For Beltran, “while the 4.1-percent forecast may seem to have breached the higher end of

the inflation target range, it is largely on account of the price increase of sin products.”

33
 “These are non-essential and are even harmful, products which we want the general

public to steer clear away from on health reasons. Of the 4.1-percent forecast, 0.4 percentage

point is accounted for by sin products,” according to Beltran.

The BangkoSentral ng Pilipinas expects headline inflation to average 4.3 percent this

year and breach the 2-4 percent target range due to the impact on consumer prices of the first tax

reform package as well as expected global oil price hikes. (de Vera, 2018)

CONSUMER BUYING BEHAVIOR

Kotler & Keller (2012) stated that price is the one element of the marketing mix that

produces revenue; the other elements produce costs. They also stated that purchase decisions are

based on how consumers perceive prices and what they consider the current actual price to be.

Understanding how consumers arrive at their perceptions of prices is an important marketing

priority.

According to ManaliKhaniwale (2015) Consumer behavior involves the study of

individuals and the method they employ to choose, utilize, and set out products and services to

fulfill their wants and the effect that these methods have on the consumer and the society as a

whole. Consumer behavior refers to all the thought, feelings and actions that an individual has or

takes before or while buying any product, service or idea. Buyer behavior is the concept which

answers what, why, how, when, and where an individual makes purchase. As a result, the

outcome of buyer behavior is the buyer’s decision. According to Kotler & Keller (2012)

consumer behavior is the study of how individuals, groups, and organizations select, buy, use,

and dispose of goods, services, ideas, or experiences to satisfy their needs and wants.

34
 One of the common models of consumer decision making process has been offered by

Blackwell et al (2006); According to him, the five stages of consumer decision making process

are followings: problem/need recognition, information search, evaluation of alternatives,

purchase decision made and post purchase evaluation.

The Effect of Pricing on Consumer Buying Behavior

Tulwin’s (2014) research analyzed important price–related issues that determine the

purchase decisions of consumers. The survey results prove, that each person requires price

incentives (increase or decrease) of different strength to choose another product than the one

initially preferred, depending on personal and situational factors.

First of all, more price sensitive buyers actually need lower price change to change their

purchase decision. Also, if the consumer has a strong preference towards one of the products, the

bigger reduction or increase is required to induce him/her to choose the less preferred option. No

regularity has been noticed between the initial price of the product and the percentage price

decrease/increase that motivates the consumers to verify their shopping basket. Moreover, people

are significantly more sensitive to price increase than to the analogous reduction, what should be

considered in all managerial decisions concerning pricing strategy.

Basic personal characteristics, such as gender, age and career standing have a

considerable impact on consumer’s price sensitivity, which turned out to be stronger for men,

younger people, students and unemployed. At the same time, no big differences have been

observed in the survey in terms of nationality. Here there is much space for further research, to

see how price sensitivity differ between other, possibly more economically diversified nations.

In Al-Salamin and Al-Hassan’s (2016), in his research, concluded that there is a positive

relationship between prices and consumer buying behavior (suitable prices make consumers

35
more willing to purchase items). The research also showed that there is no statistically significant

difference between the responses of individuals “due to age, gender, marital status, qualification

and monthly salary” about the research's questions related to the three pricing strategies (Odd

pricing strategy, Bundle pricing strategy and Discount pricing strategy) except there is a

statistically difference between the responses of individuals “due to gender” about the odd

pricing strategy.

Based on the paper's conclusion, retailers and dealers are recommended to carefully study

consumers buying behavior which is one of the most successful ways to know consumers’

interests when making a purchase decision and to set suitable prices to their items as pricing has

a direct impact on a company's revenue and consequently to its success. It is recommended that

to segment consumer based on demographic characteristics and study carefully their needs and

willingness to buy products or services. Moreover, here is an important factor that affect

consumer buying behavior in positive way which is corporate social responsibility ( CSR ). If the

company socially responsible and announce that the part of this payment of selected products

will donate to non-profit organization or for event inside society, which will encourage consumer

to select the products impulsively.

Factors affecting consumer behavior of purchasing tobacco products

According to the World Health Organization Philippines, the consumption of tobacco

depends on:

 Price of the tobacco product

 Disposable income of the consumer

 Demographic characteristics of the population (e.g., gender, age, ethnicity)

 Socio-economic status of the population (e.g., education, occupation, employment status)

36
  Rural versus urban area of residence

 Tobacco control interventions (e.g., smoking restrictions, bans on advertising and

promotion of tobacco products)

 Knowledge and information about the health effects of tobacco use

Higher prices influence the demand for tobacco products in two ways:

1. They reduce the prevalence of tobacco use

 by discouraging non-users from taking up tobacco use;

 by encouraging existing users to quit;

 by helping former users to stay quit;

 by preventing occasional smokers from turning into regular smokers.

2. Higher tobacco prices reduce the consumption of tobacco products among those who use

tobacco after a price increase.

SARI-SARI STORE

A sari-sari store, or neighborhood variety store, is a convenience store found in the

Philippines. Such stores form an important economic and social position in a Filipino

community. It is present in almost all neighborhoods, sometimes even on every street. Most sari-

sari stores are family-run shops and are operated from the owner’s house. Candies in recycled

jars, canned goods and cigarettes are often displayed while cooking oil, salt and sugar are stored

at the back of the shop. They also distribute prepaid mobile phone credits, (services). (Wisby,

2016)

Almost all sari-sari stores use retail techniques called takal (by measured volume) and

tingi (by piece), which refers to the division of goods into quantities smaller than is usually

37
available in the marketplace (e.g. cigarettes are sold by the stick, cooking oil by the cup, etc.)

(Malapit, 2007)

A sari-sari store is a micro-enterprise but that does not mean you do not need a business

permit to operate it.

Barangay Business Clearance is one of the permits or documents required when

registering a new business in the Philippines. This form is also needed when renewing your

expired Mayor’s Permit or Business License, changing a new business location and changing a

new commercial name. (Dungo, 2018)

Micro business enterprises are considered as those small businesses that have total assets

of less than Php 3,000,000 excluding the land where the business is located. Businesses that

employ less than 10 workers can also be considered micro-businesses. There are also micro-

enterprises that are home-based and some are only carried out in a part time basis. Micro

businesses may also be registered in the Philippines as a Barangay Micro Business Enterprise

(BMBE) under Republic Act 9178 to enjoy privileges such as income tax exemption and priority

to government’s financial, technical, marketing, and knowledge support. If you are passionate to

enter into business, here’s a list of micro business ideas in the Philippines.

Trading, merchandising and retail

1. Sari-sari store

2. Mini grocery store

3. RTW (ready to wear) and apparel store

4. Cellphone loading business

5. School supplies store(Abrugar, 2013)

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CEBU, PHILIPPINES

Cebu City is the oldest city in the Philippines which is also known as the Queen City of

the South. Found in the island are rich traces of the Philippine history left by mostly the

Spaniards. Among these historical sites are the Magellan’s Cross found in downtown Cebu (a

Christian cross planted by the Portuguese and Spanish explorers as ordered by Ferdinand

Magellan upon arriving in Cebu on April 1521) and the Colon Street (the oldest and the shortest

national road in the Philippines).Cebu is an island province in the Philippines and is better

known as the Queen City of the South because of its huge potential in terms of economy and

infrastructure.

Through the years, Cebu became more and more industrialized. The rise of big

companies, the trend of technology, and the innovation by the people make Cebu very

progressive. Cebu is now the home for many BPOs and small to very large companies that

contribute to the progression of the whole island especially Cebu City.

Cebu City is a first class highly urbanized city in the island province of Cebu in Central

Visayas, Philippines. Though the seat of government and capital for the province, it is governed

independent and separate from it. According to the 2015 census, it has a population of 922,611,

making it the fifth most populated city in the nation and the most populous in the Visayas. Cebu

City is a significant center of commerce, trade and education in the Visayas.

Based on the 2015 consensus, the largest in terms of population size is Guadalupe in

Cebu City, Cebu with 61,238 persons.

39
Conceptual Framework

Figure 2.1 Conceptual Framework Diagram

The general concept of this study is to analyze whether the effective sin tax control

measures would consistently reduce consumption of cigarettes across all types and raise revenue

dedicated to universal healthcare as envisioned by the Philippine Government.

Noting the above figure regarding the current situation in V. Rama Avenue, Barangay

Guadalupe Cebu City, the researchers measure the sales volume as the basis for cigarette

consumption.

To determine the quantitative aspect of the data, the researchers gather information about

the monthly sales volume of cigarettes in Sari-sari stores. The data for such values are obtained

through the conduction of surveys to acquire the necessary data that they need in order to find

out the number of cigarettes consumed and differentiate the results before and after the

implementation of TRAIN Law.

40
 In addition, to determine the measure of cigarette consumption, the researchers also take

into account and consider necessary factors in the analysis of the information obtained. Such

factors are the following:

 Supply of cigarettes in a sari-sari store

 Brand of cigarettes

41
 CHAPTER III

METHODOLOGY

The Research Methodology contains five parts: Research Environment, Research

Respondents, Research Instruments, Research Design and Research Procedure. Accordingly,

these parts specify the scope of the research in terms of location and key respondents, and what

instruments were used in data gathering, and the statistical tools that were used in analyzing the

gathered data. This chapter will guide the reader through the researcher’s completed

methodology.

Research Environment

This study specifically focused on the sales volume of the vendors located within

Barangay Guadalupe, Cebu City, in the southern district of the city, it has the biggest population

size among all 80 barangays. People from age groups 15 to 19 years and 20 to 24 years garnered

the highest percent or the total population in the city according to the 2007 Census of the

Population by the National Statistics Office.

Figure 3.0 Research Locale (Source: http://ronalissaagustino.blogspot.com)

42
Research Respondents

The main respondents of this study are the owners of the registered sari-sari stores at V.

Rama Avenue, Barangay Guadalupe, Cebu City. The subjects of this study were the different

sales volume of cigarettes and the different brands of cigarettes sold by the respondents.

Research Instruments

The study made use of the following data from various sources: 1) List of Sari-sari stores

with issued business permit from the Barangay hall of Guadalupe, Cebu City; and 2) Data

gathered regarding the sales volume of Cigarettes sold per month before and under TRAIN Law.

Research Design

The researchers will choose a survey research design to gather data in order to answer

questions and inquiries relating to the study. A convenience sampling procedure will be used in

selecting the participants of the study. This technique is a process of selecting subjects or units

for examination and analysis that is based on accessibility, ease, speed, and low cost. Units are

not purposefully or strategically selected. The respondents are just within the proximity of the

researchers. This technique will also ensure a fairly equal representation of the variables of the

study.

Research Procedures

Gathering of Data

The gathering of data consisted of five (5) stages. The first phase is establishing

connection with Barangay Guadalupe to obtain the list of registered sari-sari stores within the

43
research environment. This is an important part of the process because researchers have to state

the significance of the study to the barangay to gain consent, inquire and gather sufficient

information.

The second stage is conducting the survey. The researchers decided that the appropriate

area to conduct the survey must be accessible and convenient due to time constraints. The main

road that the people commonly pass through when entering Barangay Guadalupe is the V. Rama

Avenue. The sari-sari stores situated at V. Rama Avenue in Barangay Guadalupe are the

respondents. The survey is done through handing out questionnaires in query of general

information of the sari-sari stores and questions which relates to supply and demand.

In the third stage, the researchers gathered the questionnaires collected from the survey.

Out of 21 registered sari-sari stores located at V. Rama Avenue, only 17 sari-sari stores

responded, 3 of which declined and 1 store do not sell cigarettes.

In the fourth stage, presentation of the data gathered. The data is presented through

tables, graphs and interpretations.

In the fifth stage, effectively organizing all necessary data and information is done. This

process serves as a clearer path so that it would be easier for the researchers to form conclusion

and come up with helpful recommendations.

Statistical Tools Used

The following statistical procedure was used in the study:

 T-test is used to determine the difference between two sample means from two normally

distributed populations with unknown variances.

44
Data Analysis Tools

The T-test for Paired Two Sample for Means will be used to determine if there is a

significant difference between the sales volume of cigarettes sold by the Sari-sari stores at V.

Rama Avenue, Barangay Guadalupe, Cebu City before and after the implementation of TRAIN

Law:

∑𝐷
t= 2 2
√𝑛 ∑ 𝐷 −(∑ 𝐷)
𝑛−1

Where:

t = t-test value

∑ 𝐷 = the sum of the difference from the sales volume before and after the

implementation of TRAIN Law

2
(∑ 𝐷) = sum of the squares of the difference from the sales volume before and

after the implementation of TRAIN Law

Statistical significance is calculated by comparing the tabulated t-value with the t-value.

If the t-value is larger than the tabulated t-value, reject the null hypothesis and if the t-value is

lesser that the tabulated t-value, accept the null hypothesis.Also, statistical significance can be

calculated usinga p-value. If the p-value is less than the significance level set (0.05), the null

hypothesis is rejected, and if the p-value is greater than 0.05, accept the null hypothesis.

45
 CHAPTER IV

PRESENTATION, ANALYSIS, AND INTERPRETATION OF DATA

Presented in this chapter are the results and interpretations of the data gathered in the

study. In the analysis regarding the effects of higher sin taxes imposed on cigarettes to sari-sari

stores at V. Rama Avenue, Barangay Guadalupe, Cebu City, the researchers formulated a survey

questionnaire in gathering data from the respondents. The researchers acquired a list of the

registered sari-sari stores in Barangay Guadalupe, Cebu City. As of April 2018, fifty-five (55)

sari-sari stores were currently registered in the barangay. By applying the convenience sampling

technique in choosing the respondents, the researchers selected V. Rama Avenue as its sampled

cluster where the analysis of the study was conducted. There are only twenty-one (21) out of

fifty-five (55) registered sari sari-stores situated in V. Rama Avenue, Guadalupe Cebu City.

Table 4.1 contains the names and survey responses of the sari-sari store owners in V.

Rama Avenue, Barangay Guadalupe Cebu City. Only 17 (81% of the total population) were

selected to be the respondents of the study, as presented in Figure 4.1. The study is concentrated

to the affected sampled cluster which are those registered for the year 2018 or in the event that

the sari-sari store is registered last year but such registration is not yet renewed this month were

still chosen as long as they are doing business in V. Rama Avenue in the urban barangay of

Guadalupe City. Those who refused to be interviewed and those who do not sell cigarettes are no

longer part of the study.

Figure 4.1 Survey Responses

14% Declined
5%
Do Not Sell Cigarettes
81% Responded
46
 Table 4.1: Registered Sari-Sari stores in V.Rama Avenue, Barangay Guadalupe, Cebu City

REGISTERED SARI-SARI STORES (2018)

BUSINESS DO NOT SELL
PERMITEE NAME DECLINED
CIGARETTES
RESPONDED TOTAL
NAME
Alexander O. Visitacion Alex Store x
Diana G. Lepiten Lola Ping2 Store x
Ernesto Lopez Sari Sari Store x
East Coast
Esrellita Q. Ator Variety Store x
Fritz L. Vergara Sari Sari Store x
Sunray Sari Sari
Gina G. Matutinao Store x
Widder General
Jocelyn C. Liegel Merchandising x
Jose Redongo Sari Sari Store x
Loina D. Ranili Buding Store x
Luzinda M. Carmelotes Sari Sari Store x
Praxedes Sala Ceding Store x
Romeo Sari Sari
Romeo O. Jatico Store x
Samuel Bayot Samvic Store x
Vicky And
Victoris V. Bayot Raymond Store x
Virginia Gabutan Sari Sari Store x
Lilybeth Y. Sapid Sari Sari Store x
Donaphiel Rama Sari Sari Store x
Jacqueline B. Yap Jacko Store x
Junnettejumalon Doydoy Store x
Bryden Sari Sari
Rebecca C. Calipay Store x
Citybakers Sari
Rizshel S. Cadungog Sari Store x
Total 3 1 17 21

47
 Table 4.2: Sales volume based on the total number of packs sold on all cigarette brands

PERMITEE NAME BUSINESS NAME TOTAL NO. OF PACKS SOLD

2017 2018
Ernesto Lopez Sari Sari Store 525 400
Esrellita Q. Ator East Coast Variety Store 70 80
Fritz L. Vergara Sari Sari Store 1005 1215
Gina G. Matutinao Sunray Sari Sari Store 225 195
Widder General
Jocelyn C. Liegel Merchandising 330 210
Jose Redongo Sari Sari Store 35 15
Luzinda M.
Carmelotes Sari Sari Store 220 220
Praxedes Sala Ceding Store 765 590
Romeo O. Jatico Romeo Sari Sari Store 310 215
Victoris V. Bayot Vicky And Raymond Store 270 265
Virginia Gabutan Sari Sari Store 170 255
Lilybeth Y. Sapid Sari Sari Store 210 140
Donaphiel Rama Sari Sari Store 560 265
Jacqueline B. Yap Jacko Store 140 160
Junnettejumalon Doydoy Store 135 180
Rebecca C. Calipay Bryden Sari Sari Store 195 270
Rizshel S.
Cadungog Citybakers Sari Sari Store 95 80
TOTAL 5260 4755

Table 4.6 shows the total number of cigarette packs sold by each sari-sari stores on

December 2017 and May 2018. Before the implementation of the TRAIN Law, the total sales

volume of cigarettes sold is 5260 packs. Under the implementation of the TRAIN Law, the total

number of packs sold is 4755. There has been a decline of 505 packs of cigarettes, due to the

TRAIN Law.

48
 Table 4.3: Statistical hypothesis testing using t-Test: Paired Two Sample for Means

Computed Tabulated
Period n x̅ SD P-Value
t-value t-value
December 2017 17 309.4118 254.1299
1.0752 2.120 0.2982
May 2018 17 279.7059 265.6926

As shown in table 4.3, the computed t-value of 1.0752 is lesser than the tabulated t-value,

and the p-value is greater than 0.05, this means that the null hypothesis is ACCEPTED. In other

words, there is no significant difference between the sales volume of cigarettes sold by the Sari-

sari stores at V. Rama Avenue., Barangay Guadalupe, Cebu City before and after the

implementation of TRAIN Law.

49
 CHAPTER V

SUMMARY OF FINDINGS, CONCLUSIONS AND RECOMMENDATIONS

Summary

The purpose of this study is: 1) to know the effects of higher sin taxes imposed on

cigarettes (under the Tax Reform for Acceleration and Inclusion (TRAIN) Law) to the

consumption of cigarettes in V. Rama Avenue., Barangay Guadalupe, Cebu City and 2) to

determine whether the Philippine government has achieved its objective of reducing cigarette

consumption in the said location.

A descriptive method has been used by the researchers to gather data. The data from the

survey questionnaires had been gathered from the seventeen (17) sari-sari stores (respondents) in

V. Rama Avenue, Barangay Guadalupe, Cebu City. The survey was conducted at the said

location on the year 2018.

First, the researchers found an accessible area to conduct the research activity. Due to

time constraints, V. Rama Avenue, Barangay Guadalupe, Cebu City was the location chosen by

the researchers. Second, an inquiry to the barangay hall of Barangay Guadalupe was done in

order to obtain the list of registered sari-sari stores in the said barangay. After that, a survey was

conducted to the sari-sari stores located in V. Rama Avenue.

The researchers then gathered information from the chosen respondents as to the sales

volume of cigarettes sold for the years 2017 (before the implementation of TRAIN Law) and

2018 (after the implementation of TRAIN Law) through survey questionnaires. They have

formulated questions to further support the study: 1) as to what brands of cigarettes the

respondents usually sell, 2) as to the shift of cigarette prices, due to the implementation of the

50
TRAIN Law, 3) most preferred cigarette brands of consumers, and 4) number of cigarettes packs

sold for the years 2017 and 2018.

After conducting the survey, discussions were made and all the findings have been

summarized and discussed in table 4.2 and 4.3. As shown, there has been a decrease in the sales

volume of cigarettes sold by sari-sari stores. The reasons for such changes are mainly caused by

the increase in selling price due to the implementation of TRAIN Law and the consumption

behavior of the consumers.

Conclusion

Based on the results of the data gathered, the researchers conclude that the effects of

higher sin taxes under the implementation of the Tax Reform for Acceleration and Inclusion

(TRAIN) Law does not greatly affect the number of cigarettes sold by the sari-sari stores.

After the survey and the procedures done by the researchers, results have shown that

although there is a decrease in the sales volume of cigarettes sold in V. Rama Avenue, Barangay

Guadalupe, Cebu City, such decrease is not significant, as computed using the T-test: Paired

Two Sample for Means.

Thus, the null hypothesis is accepted and due to these reasons, the Philippine government

did not meet its goals in reducing cigarette consumption in such location.

Recommendations

As shown in the findings from the data, the following are hereby proposed: (1) Surveys

should be conducted to collect information on cigarette consumption in stores like Metro Retail

Stores, Ayala Malls, SM Retails or cigarette manufacturers if possible because they provide

51
collective and more reliable data compared to sari-sari stores. (2) The legislators and the local

government units can carry out plans and programs that will further regulate the cigarette

consumption of the public (3) Combine price increases with a comprehensive cigarette

prevention and control program for maximum effectiveness. The newly implemented Tax

Reform for Acceleration and Inclusion (TRAIN) Law is not effective as projected. Rather, it only

encourages consumption of cheaper cigarette brands. Cigarette control cannot only rely on

taxation. Even the best thought-out and well implemented taxation system cannot completely

defeat the health and social costs of smoking.

52
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57
 APPENDIX A

RESEARCH INSTRUMENTS

A. Survey Questionnaire

B.

58
C. List of Registered Sari-Sari Stores in Barangay Guadalupe, Cebu City

59
 APPENDIX B

CURRICULUM VITAE

PERSONAL INFORMATION

Name : Cantones, Angel Marie M.

Date of Birth : September 11, 1998
Address : Purok 2, Upper Song-on, Loon, Bohol
Contact No. : 09061445131
Email Address : cantonesangelmarie@gmail.com

EDUCATIONAL BACKGROUND

Primary STO. NIÑO DELA PAZ ELEMENTARY SCHOOL

Tontonan, Loon, Bohol
S.Y. 2010-2011

Secondary HOLY SPIRIT SCHOOL OF TAGBILARAN

J. Borja Street, Tagbilaran City, Bohol
S.Y. 2014-2015

Tertiary UNIVERSITY OF SAN CARLOS

P. Del Rosario Street, Cebu City, Cebu
S.Y. 2015-Present

AFFILIATIONS/MEMBERSHIP IN ORGANIZATION

Member, Junior Philippine Institute of Accountants (JPIA)

2015-present

TRAININGS/SEMINARS/WORKSHOP

JPIA Pasundayag 1 Accountancy Convention (SM Cebu)

st

JPIA Pasundayag 2 Accountancy Convention (SM Cebu)

nd

JPIA Accountancy Trail 3 Convention (SM Seaside)

rd

JPIA Accountancy Trail 4 Convention (JCentre Mall)

th

60
 CURRICULUM VITAE

PERSONAL INFORMATION

Name : Catarina, Josel Ann D.

Date of Birth : March 15, 1999
Address : Exoville, Basak Pardo, Cebu City
Contact No. : 09562776545
Email Address : jslcatarina@gmail.com

EDUCATIONAL BACKGROUND

Primary SAE YOUNG CHRISTIAN SCHOOL

F. Jaca St., Pardo, Cebu City
2005-2011

Secondary CEBU CITY NATIONAL SCIENCE HIGH SCHOOL

Salvador St., Labangon, Cebu City
2012 – 2015

Tertiary UNIVERSITY OF SAN CARLOS

P. Del Rosario Street, Cebu City, Cebu
S.Y. 2015-Present

AFFILIATIONS/MEMBERSHIP IN ORGANIZATION
Full Time Scholar, VICSAL Scholarship Foundation
2015-Present
Member, Junior Philippines Institute of Accountants
2015-Present
Asst. Executive Press Relations Officer, University of San Carlos - Juniors Philippines
Institute of Accountants
2018-Present
Executive Secretary, USC JPIA Artist Circle
2017-2018

TRAININGS/SEMINARS/WORKSHOP
JPIA Pasundayag 1 Accountancy Convention (SM Cebu)
st

JPIA Pasundayag 2 Accountancy Convention (SM Cebu)

nd

JPIA Accountancy Trail 3 Convention (SM Seaside)

rd

JPIA Accountancy Trail 4 Convention (JCentre Mall)

th

61
 CURRICULUM VITAE

PERSONAL INFORMATION

Name : Anne Zoe Rose G. Enclunar

Date of Birth : September 10, 1998
Address : NGA, Lahug, Cebu City
Contact No. : 09950077165
Email Address : annezoeroseenclunar@gmail.com

EDUCATIONAL BACKGROUND

Primary BARRIO LUZ ELEMENTARY SCHOOL

Archbishop Reyes Avenue, Banilad Road, Cebu City
2008 – 2012

SANTA FE CENTRAL SCHOOL

Poblacion, Santa Fe, Bantayan Island Cebu
2006 – 2008

Secondary CEBU CITY NATIONAL SCIENCE HIGH SCHOOL

Salvador St., Labangon, Cebu City
2012 – 2015

Tertiary UNIVERSITY OF SAN CARLOS

P. del Rosario Street, Cebu City
2015 – Present

AFFILIATIONS/MEMBERSHIP IN ORGANIZATION

Member, Junior Philippine Institute of Accountants (JPIA)

2015 – Present
Layout Cluster Head, ECHOES USC-JPIA Official Publication
2016 – Present
Member, SBE Gazette Official Publication of SBE Council
2017 – 2018
Member, Monitoring Evaluations Committee
2017 – Present

TRAININGS/SEMINARS/WORKSHOP

National Mid-Year Convention (Waterfront Mactan)

JPIA Pasundayag 1st Accountancy Convention (SM Cebu)
JPIA Pasundayag 2nd Accountancy Convention (SM Cebu)
JPIA Accountancy Trail 3rd Convention (SM Seaside)
JPIA Accountancy Trail 4th Convention (JCentre Mall)
Philippine Stock Exchange: Stock Market Seminar (Cebu Business Park)
Google Women Techmakers Cebu 2018 (The Company Cebu)
SparkFest Cebu 2018 (UP CEBU Performing Arts Hall)
Sun Life Financial - Let’s Have Some Funds (Ayala Mall Activity Center)

62
 CURRICULUM VITAE

PERSONAL INFORMATION

Name : Marapao, Kristlynne Meh M.

Date of Birth : December 23, 1998
Address : 0571 Pahit St. Telaje, Tandag City, Surigao del Sur
Contact No. : 09772003005
Email Address : marapaokristlynne@gmail.com

EDUCATIONAL BACKGROUND

Primary SPECIAL SCIENCE ELEMENTARY SCHOOL

Tandag City, Surigao del Sur
S.Y. 2010-2011

Secondary JACINTO P. ELPA NATIONAL HIGH SCHOOL

Tandag City, Surigao del Sur
S.Y. 2014-2015

Tertiary UNIVERSITY OF SAN CARLOS

P. del Rosario Street, Cebu City
S.Y. 2015 – Present

AFFILIATIONS/MEMBERSHIP IN ORGANIZATION

Member, Junior Philippine Institute of Accountants (JPIA)

2015-present
Member, Rotaract Club of Fuente-USC Chapter
2018-present
Member, Junior Financial Executives- USC Chapter
2018-present
Member, USC Junior Jaycees
2018-present
Member, JPIA Events Service Team and JPIA Artist Circle
2017-present
Treasurer, USC-JPIA Talent Circle
2016-present

TRAININGS/SEMINARS/WORKSHOP

JPIA Pasundayag 1st Accountancy Convention (SM Cebu)

JPIA Pasundayag 2nd Accountancy Convention (SM Cebu)
JPIA Accountancy Trail 3rd Convention (SM Seaside)
JPIA Accountancy Trail 4th Convention (JCentre Mall)
Sun Life Financial - Let’s Have Some Funds (Ayala Mall)

63
 CURRICULUM VITAE

PERSONAL INFORMATION

Name : Yenna Marie R. Noval

Date of Birth : October 15, 1998
Address : 7-199 Pagsabungan, Mandaue City, Cebu
Contact No. : +63 916 361 2109
Email Address : yennamarienoval@gmail.com

EDUCATIONAL BACKGROUND

Primary PAGSABUNGAN ELEMENTARY SCHOOL

Pagsabungan, Mandaue City
2010-2012

ST. JOSEPH’SACADEMY
S.B. Cabahug, Mandaue City, 6014 Cebu
2006-2010

Secondary MANDAUE CITY SCIENCE HIGH SCHOOL

Ibabao-Estancia, Mandaue City, 6014 Cebu
2012-2015

Tertiary UNIVERSITY OF SAN CARLOS

P. del Rosario St., Cebu City
2015-Present

AFFILIATIONS/MEMBERSHIP IN ORGANIZATION

Member, Junior Philippine Institute of Accountants

2015-Present

TRAININGS/SEMINARS/WORKSHOP

JPIA Pasundayag 1 Accountancy Convention (SM Cebu)

st

JPIA Pasundayag 2 Accountancy Convention (SM Cebu)

nd

JPIA Accountancy Trail 3 Convention (SM Seaside)

rd

JPIA Accountancy Trail 4 Convention (JCentre Mall)

th

Sun Life Financial - Let’s Have Some Funds (Ayala Mall)

64
 CURRICULUM VITAE

PERSONAL INFORMATION

Name : Pajaron, Ceceilgen M.

Date of Birth : October 07, 1998
Address : Basak Pardo Cebu City
Contact No. : 09236876360
Email Address : pajaronceceilgen@gmail.com

EDUCATIONAL BACKGROUND

Primary DON VICENTE RAMA MEMORIAL ELEMENTARY SCHOOL

Macopa St., Basak Pardo Cebu City
2005-2011

Secondary CEBU CITY NATIONAL SCIENCE HIGH SCHOOL

Salvador St., Labangon Cebu City
2011-2015

Tertiary UNIVERSITY OF SAN CARLOS

P. Del Rosario St., Cebu City
2015-Present

AFFILIATIONS/MEMBERSHIP IN ORGANIZATION

Member, Junior Philippine Institute of Accountants

2015-Present

TRAININGS/SEMINARS/WORKSHOP

JPIA Pasundayag 1 Accountancy Convention (SM Cebu)

st

JPIA Pasundayag 2 Accountancy Convention (SM Cebu)

nd

JPIA Accountancy Trail 3 Convention (SM Seaside)

rd

JPIA Accountancy Trail 4 Convention (JCentre Mall)

th

65
 CURRICULUM VITAE

PERSONAL INFORMATION

Name : Klyde Raven A. Sormillon

Date of Birth : September 11, 1998
Address : Canjulao 2nd Street, Lapu-Lapu City
Contact No. : 09157589404
Email Address : klyde10112@gmail.com

EDUCATIONAL BACKGROUND

Primary ASIAN LEARNING CENTER

Sangi Road, Lapu-Lapu City
2007-2012

Secondary ASIAN LEARNING CENTER

Sangi Road, Lapu-Lapu City
2012-2015

Tertiary UNIVERSITY OF SAN CARLOS

P. del Rosario St., Cebu City
2015-Present

AFFILIATIONS/MEMBERSHIP IN ORGANIZATION

Member, Junior Philippine Institute of Accountants

2015-Present

TRAININGS/SEMINARS/WORKSHOP

JPIA Pasundayag 1 Accountancy Convention (SM Cebu)

st

JPIA Pasundayag 2 Accountancy Convention (SM Cebu)

nd

JPIA Accountancy Trail 3 Convention (SM Seaside)

rd

JPIA Accountancy Trail 4 Convention (JCentre Mall)

th

66
 CURRICULUM VITAE

PERSONAL INFORMATION

Name : Toledo, Mary Lyzzabelle P.

Date of Birth : March 30, 1998
Address : Poblacion, Danao City, Cebu
Contact No. : 09062789418
Email Address : lyzt98@gmail.com

EDUCATIONAL BACKGROUND

Primary DANAO CITY CENTRAL SCHOOL

F. Ralota St., Danao City, Cebu
2005-2011

Secondary RAMON M. DURANO SR. FOUNDATION - SCIENCE AND

TECHNOLOGY EDUCATION CENTER
Guinsay, Danao City, Cebu
2011-2015

Tertiary UNIVERSITY OF SAN CARLOS

P. del Rosario St., Cebu City
2015 - Present

AFFILIATIONS/MEMBERSHIP IN ORGANIZATION

Member, Junior Philippine Institute of Accountants (JPIA)

2015 – Present
Cartooning and Graphics Cluster Head, ECHOES USC-JPIA Official Publication
2017 – 2018
Member, SBE Gazette Official Publication of SBE Council
2017 – 2018
Chief Financial Officer, ECHOES USC-JPIA Official Publication
2018 – Present
Vice President for Graphics and Publication, Regional Federation of Junior Philippine
Institute of Accountants (RF-JPIA)
2018 – Present

TRAININGS/SEMINARS/WORKSHOP

National Mid-Year Convention (Waterfront Mactan)

MATA Expo (JCentre Mall)
Converge: RFJPIA 2nd Academic Congress (Mariners’ Court)
JPIA Pasundayag 1st Accountancy Convention (SM Cebu)
JPIA Pasundayag 2nd Accountancy Convention (SM Cebu)
JPIA Accountancy Trail 3rd Convention (SM Seaside)
JPIA Accountancy Trail 4th Convention (JCentre Mall)

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