DOF optimistic on rice tariff passage to lower inflation

The Department of Finance (DOF) is optimistic that Congress will adhere to President Rodrigo R. Duterte’s appeal to pass the rice tarrification bill as soon as possible to ease the increases in consumer prices and bring down costs of Filipinos’ stable food.

In a statement, Finance Secretary Carlos G. Dominguez III said that the proposed liberalization of rice imports will bring down the prices of rice by as much as 17 per kilo that would ultimately slowdown than the country’s inflation rate.

Dominguez said liberalizing rice imports through the passage into law of the rice tariffication bill now pending in the Congress is vital in helping low-income households cope with inflation, given that rice accounts for 20 percent of their consumption.

“Along with a national ID system, the passage of the rice tariffication bill will complement the social mitigation measures we are implementing now to further ease the impact of inflation on poor households,” Dominguez said.

The House of Representatives appropria- tions committee has already approved the funding provision for the consolidated version of its rice tariffication bill.

The counterpart version of the bill in the Senate is still being discussed at the committee level.

Based on estimates by the Bangko Sentral ng Pilipinas (BSP), allowing cheap rice imports with tariffs will immediately lower the inflation rate by 0.4 percentage points.

In his third State of the Nation Address (SONA), the President said rice tariffication was among the longterm solutions that the government is working on to lower inflation, provide farmers with additional resources and reduce rice prices by up to 17 a kilo.

“We need to switch from the current quota system in importing rice to a tariff system where rice can be imported more freely,” the President said in his July 23 SONA. “I ask Congress to prioritize this crucial reform, which I have certified as urgent today.”