August 16, 2018 at 07:25 pm
Julito G. Rada
The Finance Department is carefully studying the proposal to reduce the tariff on imported agricultural products to 5 percent.
“That was a suggestion. We are studying it,” Finance Secretary Carlos Dominguez III said in a news briefing.
“But I’m a little bit uncertain now on what is really the conditions from some people from the House [of Representatives],” he said. “We are looking at it.”
Budget Secretary Benjamin Diokno said in an earlier briefing that the Duterte administration was considering a uniform tariff of 5 percent.
“We want to make it five, so it’s simpler, more uniform. A standard rate like five is kind of neutral” and “does not affect the consumption of goods,” Diokno said in a statement.
Economic managers said in a Senate hearing the planned tariff cuts would not significantly affect revenue collection.
Finance Undersecretary Gil Beltran, however, said the decision should be weighed carefully.
“Before you change the tariff rate, you have to conduct public consultations and get the views of the producers. On the other hand, you have to look at the interest of consumers,” he said.
Beltran said it was a balancing act between the level of protection for producers and consumer interest.
Beltran said for chicken and fish, the potential revenue losses at a 5-percent tariff would be around P2.8 billion.
The reduction of tariff on imported agricultural products was one of the counter-inflation moves that House Speaker Gloria Macapagal Arroyo and other chamber leaders reportedly agreed upon with the economic managers. Imported meat was reportedly removed from the list after industry lobbying.
The Rice Tariffication Bill was also discussed in the Senate. The bill aims to impose a 35-percent tariff on imported rice from other Southeast Asian countries in lieu of quantitative restrictions.
Dominguez said the DoF was currently consulting with the Bureau of Fisheries and Aquatic Resources to know the real reasons behind the seemingly dwindling catch of fish in the past months.
“The issue on fish is very complicated because actually, we are consulting with the Bureau of the Fisheries, why the fish catch is declining... It’s really a complex issue so we have to understand really what is going on. But I think worldwide fish capture is declining,” Dominguez said.
Inflation in July accelerated to a five-year peak of 5.7 percent from 5.2 percent in June, driven by faster
increases in the prices of food products. This brought the average inflation in the first half to 4.5 percent, above the target range of 2 percent to 4 percent this year.
The faster inflation rate compelled the Bangko Sentral ng Pilipinas to raise by a rare 50 basis points the policy interest rate to 4 percent on Aug. 9.