June 25, 2024

The Insider News

Direct from the source

Marcos approves Comprehensive Tariff Program to lower prices of goods

THE National Economic and Development Authority (NEDA) Board, chaired by President Ferdinand R. Marcos Jr., approved on Monday the Comprehensive Tariff Program aimed at calibrating the current tariff rates until 2028.

In a press briefing in Malacañang on Tuesday, Socioeconomic Planning Secretary Arsenio Balisacan said the program is a strategic move to ensure access and affordability to essential commodities while balancing the interest of consumers and local producers which is crucial for fostering rapid, sustained and inclusive economic growth.

Balisacan, who heads NEDA, said that during the board’s 17th meeting, it acted on the recommendations of the Committee on Tariff and Related Matters (CTRM) to maintain the current rates on more than half of the tariff lines covering various agricultural and industrial products that have relatively low applied tariffs particularly for raw materials and intermediate inputs used in manufacturing.

“The tariff maintenance will ensure access to inputs and support efforts to improve productivity and competitiveness. This measure will help our domestic industries by reducing the cost they incur for their inputs, enabling them to be more competitive especially in the global market,” he explained.

“The board also agreed to merge these tariff lines on certain chemical and chemical products, textiles, machinery and transport equipment to simplify the tariff structure for more efficient customs administration and improve the ease of doing business,” he added.

The board also approved the CTRM’s recommendation to reduce the tariff on certain chemicals and coal briquettes to improve energy security and reduce input cost to help ensure their availability at reasonable prices, thus supporting more stable electricity prices and supply in the country.

The NEDA chief also reported that the chemicals with proposed reduction are inputs to manufacture antiseptics, detergents and medical deserts to help lower production cost and improve consumer welfare.

“The reduced tariff rates on corn, pork and mechanically-deboned meat under Executive Order No. 50, Series of 2023 were also maintained until 2028 to ensure stable supply of these commodities, help manage inflation, promote policy stability and investment planning and enhance food security,” he said.

In the case of rice, one of the most critical components of Filipino households consumption basket, the NEDA Board reduced the duty rate to 15 percent for both in-quota and out-quota rates from 35 percent until 2028. This aims to lower the price of rice further and make it more affordable.

Rice contributed about two percentage points or over 50 percent to the headline inflation, based on the latest inflation reports of the Philippine Statistics Authority in the past three months.

Moreover, the NEDA Board has retained the tariff cover for various other agricultural products including sugar, vegetables such as onion shallots, garlic, broccoli, carrots, cabbage, lettuce, sweet potatoes, cassava, coffee substitutes, complete feeds and feed preparations.

“Along with a liberalized policy regime for crucial food quantities to help mitigate the impact of commodity shocks and local prices, we recognized the necessity of effectively implementing long term and permanent solutions to modernize and improve the productivity of the agriculture sector,” Balisacan said, adding this thrust is crucial to a comprehensive and sustainable response to supply constraints and food inflation.

“Indeed, the Marcos administration has prioritized agricultural development as demonstrated by the increased allocation of resources to the sector. The DA budget for example has increased by 69 percent from 2022 to 2024 compared to its average appropriation for 2017 to 2021,” he stressed.

Following the board’s approval, the President will issue an executive order to implement the new tariff program.