What It Means
- The artificial sweetener tax proposed by sugar groups would hold pure local cane drinks at ₱6 per liter and charge every other sweetener ₱40.
- SRA has projected 2026-27 sugar output at 1.66 million metric tons, down 10.3 percent, with all of it reserved for domestic use.
- A ₱34 per liter gap on a shrinking supply turns the low tier into a rationed advantage, not an open market price.
- Mid-size bottlers and food processors without contracted domestic cane carry the exposure, while holders of origin records and cane volume gain.
The artificial sweetener tax that sugar groups want written into the ProGRESS bill rewards buyers of local cane at the moment there is less cane to buy. The Sugar Regulatory Administration (SRA) has projected 2026-27 output at 1.66 million metric tons, down 10.3 percent, and reserved all of it for domestic use. A low tier needs supply behind it. This one has a shrinking crop.
The Artificial Sweetener Tax Splits Drinks Into a ₱6 Tier and a ₱40 Tier
House Bill No. 10345, the ProGRESS bill, would raise the sweetened beverage tax from ₱6 to ₱20 per liter on drinks made with sugar, and from ₱12 to ₱40 on drinks made with high-fructose corn syrup, according to a Philstar column on the bill. Sugar groups say the Department of Finance version does not reclassify sweeteners, so cane and high-intensity sweeteners would keep sharing one bracket.
Five industry bodies wrote to SRA with a different design for the artificial sweetener tax, as Context.ph reported. Drinks made only with local pure cane sugar would stay at ₱6 per liter. Blends, non-cane sweeteners, and imports without a clear supply trail would pay ₱40. SRA and BIR records would decide who qualifies. Their letter says artificial sweetener imports grew from zero before TRAIN to 503,117 metric tons, or 18.40 percent of the market, by 2023-2025. Those are the industry’s own figures.
SRA’s Output Projection Caps the Low Tier
On October 7, SRA reserved all 2026-27 output for domestic use and projected production at 1.66 million metric tons, down from 1.85 million the previous crop year, as Context.ph reported. SRA’s statistics bulletin records 1,850,566 metric tons of raw sugar for CY 2025-2026. The pest sits in the main cane province. As of July, red-striped soft scale insect infestation covered 61,242 hectares, or 32.18 percent of Negros Occidental’s planted area, according to Manila Bulletin.
| Crop year | Raw sugar production (metric tons) |
|---|---|
| 2021-2022 | 1,820,863 |
| 2022-2023 | 1,799,466 |
| 2023-2024 | 1,922,586 |
| 2024-2025 | 2,085,534 |
| 2025-2026 | 1,850,566 |
| 2026-2027 (SRA projection) | 1,660,000 |
Under the sugar groups’ design, imports without a clear supply trail pay ₱40, so imported supply cannot fill the low tier on those terms. Eligible cane is whatever the domestic crop yields. Set at ₱40, the artificial sweetener tax only shields cane if there is cane to buy. It turns a fixed and falling volume into a ₱34 per liter advantage, the difference between ₱6 and ₱40.
Origin Records Turn Into the Allocation System
Because the artificial sweetener tax depends on SRA and BIR verification, paperwork decides who pays ₱6. Buyers with documented domestic cane clear it. Sugar buyers were already facing prices shaped by policy after the sugar buying program and floor price push earlier this year, and the origin test adds a second gate on top.
Large bottlers with supply contracts from millers and traders would be best placed to document origin, and millers and traders hold the records and the volume. If the artificial sweetener tax lifts demand for eligible cane while supply falls, the price of that cane would likely climb until sellers capture a share of the tax advantage. The tax gap would get bid into the commodity.
Mid-Size Bottlers and Food Processors Carry the Exposure
Manufacturers that moved to non-cane sweeteners because they cost less per unit of sweetness would face the artificial sweetener tax at ₱40 on those lines. The industry letter itself says high-intensity sweeteners are 200 to 600 times sweeter than sugar and enter at 1 to 3 percent duty or duty-free under ASEAN terms. That cost advantage is what the ₱40 tier is built to cancel. Pure stevia, untaxed today, would fall into the same tier.
A mid-size bottler or contract manufacturer without a miller relationship has two options under the artificial sweetener tax, pay the cane premium or pay ₱40. The case against the artificial sweetener tax is also on record. Industry representatives cited in the Philstar column say BIR data shows beverage consumption fell 9.25 percent in 2025 under the existing tax, so a rationed low tier sits on a volume base that is already shrinking. Sugar is one more input where policy decides who pays.
The ₱6 tier will clear at whatever price scarce cane commands, and buyers without a miller contract will pay either that premium or ₱40. The advantage the artificial sweetener tax creates lands first with whoever holds the origin records.
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