Agri players seek return to 1995 tariff rates

The Samahang Industriya ng Agrikultura (Sinag) is pushing for the return of 1995 tariff rates under an agreement with the World Trade Organization as lawmakers are still in the process of finalizing the amendments to the Agricultural Tariffication Act.

In a recent letter to Sen. Cynthia Villar, chair of the Senate Committee on Agriculture, Sinag proposed that “all laws, executive orders, administrative orders or provisions of laws that modified tariff lines of certain agricultural commodities as a result of the negotiations for the country’s retention of the quantitative restrictions on rice are hereby repealed and is reverted back to its original 1995 level bound rates commitment to the WTO.

With the government moving toward the removal of QR, Republic Act 8178 or the Agricultural Tariffication Act of 1996, which had put the rice import quota in place, must be amended.

Executive Order 23, which was signed by President Duterte last April, provided for a three-year extension of the QR while in transition toward the imposition of tariff.

“We should go back to the original negotiation which started in 1995. It would be more beneficial. We really need a law to tariffy rice because the EO will not be enough. We are hoping that this [bill] will be approved next year,” Sinag chairman Rosendo So said over the phone.

According to Sinag, lawmakers should revise the minimum access volume (MAV) not at the 2014 level, but from the original MAV level which was in 1995.

MAV refers to the volume of a specific agricultural product allowed to enter the country at a lower tariff as a commitment of the Philippines under the General Agreement on Tariffs and Trade of the WTO.

This means that MAV will return to its original starting level of 119,450 metric tons (MT) from the current 805,200 MT volume of rice that can be shipped into the country.

The group also called for higher tariff of 40 percent for the MAV and an even higher 250 percent once the MAV has been exceeded.

Apart from the MAV, the government is still importing rice to serve as its buffer stock.

“We propose that National Food Authority (NFA) will only undertake direct importation of rice, not exceeding 350,000 MT annually, for the sole purpose of buffer stocking in the event of a shortfall in production, a state of calamity or other verified reasons that may warrant the need for such importation,” So said.

The Philippines is among the largest rice importers in the world, bringing in over one million MT of the staple annually.

QR is a non-tariff measure that limits the volume of imports of a specific product.

In 1995, the WTO first allowed the Philippines to impose a 10-year QR on rice importation. In 2004, it was extended to 2012, and renewed in 2014.

In 2014, the WTO granted Manila’s petition for an extension of its special tax treatment on rice on the condition that it raises the annual import volume from 350,000 MT and lower the tariff to 35 percent from 40 percent.