“We don’t know why the CEAM lacks the guts to declare its true identity. Its lack of transparency is suspicious enough, not to mention its tack of resorting to inadequate, misleading information, and even outright lies, in carrying out its campaign?
by Ducky Paredes
The Concerned Entrepreneurs Against Monopoly (CEAM) has spent several millions in full-page ads published since March. Obviously, CEAM has money to burn; but who or what is CEAM?
It is not registered with the Securities and Exchange Commission either as a company, corporation, and non-profit organization or as a private foundation. Nor is it registered with the Department of Trade and Industry or any local government. It also has neither a website, a phone number, or even just a mailing address.
What we know about it is that it resorts, in its print ads to using misleading data, and even outright falsehoods. Clearly, CEAM is only a dummy fronting for some other entity with a vested interest in getting the sin tax bill passed.
CEAM has not identified any of its members, or if even it has any.
The “De Borja Law Office, counsel” was first listed as having paid for the early anti-tobacco ads. Subsequent newspaper advertisements with the same tone and tenor against the so-called “tobacco monopoly” and the need to pass the “sin tax reform bill now” have stopped identifying its counsel.
Other than this piece of information, the group or groups behind the anti-tobacco lobby remains untraceable. Its background remains murky.
Based on its well-funded media campaign, CEAM supports tax proposals that would drastically increase prices of low- to high-priced cigarettes to make these at par with imported brands. Most of the data presented in CEAM advertisements echo the position and statements released by British American Tobacco (BAT), the maker of Lucky Strike cigarettes.
The foreign firm says that it will invest up to $200 million in the country once the sin tax bill is passed by Congress and enacted into law.
In one of the full-page ads posted by the CEAM this month, a mention is made of new players in the tobacco industry who will buy 3 million kilos of local tobacco leaf once the sin tax bill is passed.
Two months before this ad was released, BAT Philippines CEO James Lafferty told the media: “This year BAT is programmed to buy approximately 1.8 million kilos of [tobacco] leaf from the Philippines. We can confirm that the company will buy at least twice that volume, or roughly 3.6 million kilos, next year.” But he was quick to add that this plan would only be realized if and when Congress passes the sin tax bill.
“Sin Tax Reform is long overdue for the Philippines,” the media also quoted Lafferty. “HB 5727 will not only generate significant additional revenues for the country, but it will finally level the playing field in our industry.” HB 5727 refers to the House proposal seeking to increase excise taxes on local tobacco and alcohol products.
Lafferty’s statement is the exact, same line used by CEAM in several of its newspaper ads against the alleged local “tobacco monopoly.”
Another Lafferty statement that the CEAM ads also use it this: “We simply want a level playing field, which means I want my brand to pay the same excise tax as the other brands at the same price. That’s it. Under the current system, if you were here before 1996, you pay this much and if you came in 1997, you pay more. How is that fair to set a pricing system based on year of entry”? This is the exact, same line CEAM uses.
The group has so far not been visible in the media or elsewhere. It has not granted any interviews or appeared in the broadcast media to amplify its views against tobacco and cigarette smoking. If its aims are legitimate, why has it remained invisible? Or, is there more to CEAM than meets the eyes?
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Is CEAM doing anything wrong? Based on the parameters and standards set by the Ad Standards Council Inc. (ASC), a non-stock, non-profit organization that aims to promote truth in advertising through self-regulation in both the print and broadcast media, the Concerned Entrepreneurs Against Monopoly (CEAM) appears liable for “misleading presentations.”
Under Section 3a of the advertising standards of the ASC “an advertisement must not create confusion as to the identity of the advertiser or the source of a product or service.”
We don’t know why the CEAM lacks the guts to declare its true identity. Its lack of transparency is suspicious enough, not to mention its tack of resorting to inadequate, misleading information, and even outright lies, in carrying out its campaign.
For instance, one of its ads point out that the taxes proposed by the House in its version of the sin tax bill does not discriminate against local brands because all cigarettes will be taxed the same rate, regardless of where the tobacco product is manufactured. It even claims that imported brands will also pay the high tax of P28.30, just like the other locally produced brands.
But the CEAM ad conveniently omits the fact that locally produced cigarettes in the high-priced tier are currently taxed P12, those in the mid-priced tier, P7.56, and low-priced brands, P2.72. Imported brands are currently paying P28.30. Mid-priced and high-priced brands, both locally produced, will be taxed 297 percent and 150 percent under the House sin tax proposal so that their taxes would be at par with imported brands. In the second year of the bill’s implementation, all these brands will pay a uniform P30 tax.
Low-priced brands, on the other hand, will be taxed 708 percent so that they would have to pay a tax of P22 per pack. The tax is higher than the cost of producing a pack of low-priced smokes. Thus, the tax being imposed by government on the low-end products would be an onerous one that gives the government a tax take several times the value of the item being taxed!
The CEAM ad did not present to the public the true picture: That imported brands, now paying P28.30, will not get any tax increase under the sin tax proposal. They will pay the same tax in the first year of the bill’s implementation, and will get a measly P2 tax increase or 6 percent in the second year.
The bill is strongly biased against local manufacturers, but the CEAM ad wants us to believe that the House measure is good for the tobacco industry and the economy.
The bill is actually good only for British American Tobacco, which even threatened the government when it publicly declared that it would only bring in its $200 million tobacco investment if the sin tax bill is passed and enacted into law.
Which makes us wonder, is there a connection between CEAM and BAT? They both don’t care whether Filipinos stop smoking or not. They both just want to get the sin tax measure passed into law in a form that would highly favor importers over local manufacturers. They both espouse the same misleading lines and half-truths about the so-called “reforms” sin tax bill. In fact, the way, they’re going, one has to doubt if that P200 million promised investment will ever really come in? Why re-write the laws to favor imports, if they actually plan to produce locally?
CEAM is a fiction created by someone to push BAT’s interests in the country? If this is not so, CEAM should dispel this nagging suspicion. Will CEAM ever come clean, or will it remain unaccountable to the public even as it pushes BAT’s agenda that smells suspiciously like some sort of scam being played on our legislature and our government?
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hvp 08.05.12Readers who missed a column can access www.duckyparedes.com/blogs. This is updated daily. Your reactions are welcome at firstname.lastname@example.org