Poultry growers decry 12% VAT on imported hatching eggs

MANILA, Philippines - The move of the United Broilers and Raisers Association (UBRA) and the Philippine Association of Broiler Integrators (PABI) to bring in 150,000 “hatching eggs” for broiler production to address a temporary shortage in chick production is being stymied by the Bureau of Custom’s imposition of a 12- percent value-added tax on the imported eggs, an industry official said.

UBRA’s Gregorio San Diego said the immediate importation of hatching eggs is intended to alleviate  a temporary tightness in chick production caused by the spate of recent destructive typhoons.

Unfortunately, the planned importation is now facing a tax hurdle which will make the cost of importation a burden to chicken growers, he said.

UBRA has enlisted the help of Agriculture Undersecretary Bernie Fondevilla to appeal to the BoC and the Department of Finance to scrap the 12- percent VAT on top of the five-percent tariff already imposed on egg imports.

Chicken supply remains adequate for now with retail prices hovering at P130 to P140 per kilo, San Diego said.

He said local chicken production of 23 million kilos will be supplemented by a special importation of five million kilos for a total supply of 28 million kilos of chicken this December. The bulk of the special imports are chicken leg quarters from the United States.

Prior to typhoon “Ondoy”, the cost of chick production was between P8 to P12 per head. However, a change in nutrition with the shift of feed ingredients from corn to feedwheat caused a disruption in production. This was further aggravated by the spate of typhoons, resulting in almost no delivery of day-old chicks.

Thus, from the price of chicks then at P28 per head, the price of day-old chicks has now jumped to P35 per head, San Diego said.

To address this problem, chicken growers have asked the Department of Agriculture to allow the importation of additional hatching eggs to be sourced from Malaysia which remains a bird flu-free country.