MANILA, Philippines – President Aquino has signed an executive order modifying the most favoured nation (MFN) tariff rates of a wide range of agricultural products to enable the Philippines to conform to its commitment to the World Trade Organization (WTO) in exchange for the extension of the special tax treatment on rice.
The WTO General Council approved in July 2014 the Philippines’ petition for the continued imposition of high tariff on imported rice at a limited volume until June 2017.
Upon expiration of the country’s quantitative restriction (QR) on rice in June 2012, the Agriculture department sought a five-year extension of its implementation to give Filipino farmers time to build their production capability and cope with increased pressure that comes with the enforcement of free trade within Southeast Asia this year.
With the extension of the QR, the Philippines would continue to impose a high tariff of 40 percent on rice imported within the Minimum Access Volume (MAV) scheme and 50 percent for rice imported outside of MAV.
In keeping with the Asean free trade regime, all rice imports that would come from Asean member states would be levied a duty of 35 percent.
The MAV has also been increased to 805,200 MT from 350,000 MT.
In supporting the country’s bid for the QR extension, countries that supported the Philippines’ petition asked for concessions and ease of market access for their agricultural products.
Executive Order 190, signed on Nov. 5, enforces the temporary modification of MFN rates on rice imports and non-rice products.
Rice in husk, semi-milled rice, glutinous rice, broken rice, and parboiled rice will be levied a duty of 35 percent until June 30, 2017. Starting July 1, 2017, the tariff will be raised to 40 percent.
Swine, sheep and goat will be levied a duty of five percent until July 2017 while deboned poultry meat will be levied a duty of between five and 20 percent until June 30, 2017 but this will be raised to between 30 and 40 percent on July 1, 2017.
Duty on pork and poultry fat will remain at five percent until July 1, 2017.
Tariff on various dairy products will be at one percent to five percent until June 30, 2017 and shall be increased to three to seven percent on July 1, 2017.
Duties on legumes will range from one to three percent until June 30, 2017 and will be raised to seven percent on July 1, 2017.
Duty on flour will remain at three percent until July 1, 2017.
The Tariff Commission defines the MFN tariff schedule as Philippine tariff rates that are applicable to imports from all sources.
The Tariff and Customs Code of the Philippines gives Pres. Aquino the authority to modify tariff rates upon recommendation by the National Economic Development Authority.
Under Sec. 401 of the TCCP, the President can “reduce by not more than 50 percent or increase by not more than five times the rate of duty expressly statute when in his judgement such modification in the rates of import duty is necessary in the interest of the national economy.” – With Delon Porcalla