The Senate has adopted a resolution urging President Marcos to revert the imported rice tariff rate from the current low 15 percent to 35 percent, in a bid to reduce farmers’ income losses to importation.
The resolution was adopted during the plenary session on Wednesday, and called on the executive to reinstate the ‘most favored nation’ tariff rate back to 35 percent.
Sen. Francis Pangilinan, a sponsor of the measure as chair of the Senate committee on agriculture, food and agrarian reform, said in his privilege speech that imported rice should be levied with the previous rate, ahead of the end of the 60-day rice importation ban earlier imposed by the President.
Pangilinan said it is time to raise the tariffs because of low world market prices at $376 per metric ton this year, from $700 per metric ton last year, and the threat of imported rice to the harvest of domestic farmers.
Bringing back the 35 percent tariff rate would strengthen domestic rice production, narrow the gap of farmgate prices and production cost and restore the government’s P27-billion revenue loss due to the lower rate.
The P27-billion could have been used to fund the Rice Competitiveness Enhancement Fund, which provides financial aid and equipment to farmers.
The move last year to lower the tariff rate from 35 percent to 15 percent resulted in a drop of farmgate price of palay to P7.66 per kilo, below the production cost of P13.51 per kilo, Pangilinan said.
‘The winner? Importers and traders who pocket the difference of P7 at less than P1 per kilo. Who lost? Palay farmers and consumers. The loser: government,’ Pangilinan said in Filipino.
During yesterday’s Senate hearing on the proposed budget of the Department of Economy, Planning and Development (DEPDev), Senate finance chair Sherwin Gatchalian asked about the executive’s plan to bring back the 35 percent tariff.
DEPDev Secretary Arsenio Balisacan said the agency ‘has been discussing with the President’ the issue of the low rice tariff rate despite a decrease in world prices and a drop in farmgate prices.
Balisacan said one option besides raising the tariff rate is giving price support to farmers, while moderating the increase in tariffs and not putting pressure on inflation.