Rice tariff collections fall by 27 percent
The Philippines’ rice tariff collections dropped 27.54% to P884.4 million in July, due to the reduced 15% tariff rate on rice imports. The Bureau of Customs reported a 22% increase in rice import volume to 197,287 MT, but still half of the average monthly volume. The lower tariff rate is expected to lead to more affordable rice, with a projected P6-7 per kilogram decrease in retail prices. Total rice tariff collections from January to July reached P24.078 billion, 28% higher than the same period last year.
MANILA, Philippines — Rice tariff collections in July shrank by more than a quarter on an annual basis to less than P900 million after President Marcos’ order lowering the tariff rate on the commodity to 15 percent took effect.
Preliminary Bureau of Customs (BOC) data analyzed by The STAR showed the agency collected P884.4 million in tariffs from almost 200,000 metric tons (MT) of imported rice last month.
The amount was 27.54 percent lower than the P1.22 billion collected in the same month last year.
Government officials and industry players have expected the drop in tariff collection after the 15 percent tariff rate on rice imports took effect last July 5 as part of Marcos’ Executive Order 62.
Some industry stakeholders noted that rice import volume must more than double to generate the same amount of tariff collections under the previous 35 percent rate.
Nonetheless, rice import volume is anticipated to surge as traders are incentivized by the reduced tariff rate.
For example, the United States Department of Agriculture is projecting that the Philippines would bring in 4.7 million MT of rice this year as a result of the reduction in tariffs.
But government officials including Agriculture Secretary Francisco Tiu Laurel Jr. do not see rice import volume hitting such a figure as a result of market competition.
Rice import volume in July rose by 22 percent year-on-year to 197,287 MT from 161,440 MT, based on BOC data. BOC data indicated that all of the rice imports last month was slapped with 15 percent tariff.
Despite the increase, the import volume was just half of the average monthly volume of rice brought in the country in the first half.
Local traders and importers have slowed down in their rice purchases abroad as they are still depleting their old stocks bought at higher tariff rates.
Nonetheless, the pace of rice import volume is seen to pick up starting this month, leading to the availability of more affordable rice in the market, pundits said.
Government officials earlier noted that the tariff reduction would cut retail rice prices by P6 to P7 per kilogram.
Latest BOC showed that the landed cost of imported rice stocks have declined on a monthly basis in July as a result of the tariff reduction.
The average landed cost of imported rice last month fell by 15 percent to P34.56 per kilogram from P40.96 per kilogram average cost in June.
Total rice tariff collections from January to July hit P24.078 billion, about 28 percent higher than the P18.823 billion recorded in the same period a year ago driven by bigger import volume and higher cost, based on BOC data.
Rice tariff collections have been critical in the past six years since it is being earmarked by the government to develop and modernize the country’s rice industry through the rice competitiveness enhancement fund (RCEF) and its ancillary programs.
The government is poised to extend the RCEF, which is set to expire this year, with Congress deliberating on the matter.
Source Link : https://www.philstar.com/business/2024/08/05/2375405/rice-tariff-collections-fall-27-percent
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