Neda board approves Comprehensive Tariff Program until 2028

MANILA. Neda chairperson Arsenio Balisacan.
MANILA. Neda chairperson Arsenio Balisacan.Photo fron Neda

THE National Economic and Development Authority (Neda) board approved on Monday, June 3, 2024, the Comprehensive Tariff Program 2024-2028, which is seen to ensure access and affordability to essential commodities while balancing the interest of consumers and local producers.

The Neda board, chaired by President Ferdinand Marcos Jr., approved the program, which is considered crucial for fostering rapid, sustained and inclusive economic growth.

The program is aimed to calibrate the current tariff rates until 2028, as recommended by 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.

It also covers the reduction of the tariff on certain chemicals and coal briquettes to improve energy security and reduce input cost to help ensure their availability at reasonable prices in a bid to stabilize electricity prices and supply in the country.

The program will also keep the reduced tariff rates on corn, pork and mechanically-deboned meat in a bid to ensure stable supply of these commodities, help manage inflation, promote policy stability and investment planning and enhance food security.

In a press conference, Neda chairperson Arsenio Balisacan said maintaining tariff rates 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 said.

“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.

Balisacan expressed optimism that through the program, the price of rice, a staple food of every Filipino family, will go down to P29 per kilo.

Under the program, the duty rate for rice was reduced to 15 percent for both in-quota and out-quota rates from 35 percent until 2028.

“We are at least aiming for, the Department of Agriculture is aiming for a reduction of P29 per kilo, at least for the poor, because we will complement this tariff reduction with the direct subsidies to the poor and vulnerable so that at least they could access the food, the 29 pesos per kilo,” Balisacan said.

“But overall, with the tariff reduction from 35 to 15 percent, everybody will benefit from that. This is crucial as I emphasized because world prices are still increasing. And so, if we don’t reduce the tariff, with the increasing world prices compounded by 35 percent tariff over and above that, prices and inflation will remain to be very serious problem. So with this, we expect those upward pressure and rice prices to ease,” he added.

However, Balisacan said it will take a little bit more time before it can be attained since an executive order has to be issued and that will influence the decision of private sectors to import.

The Philippine Statistics Authority (PSA) has recorded a slower annual increase of 23.0 percent during the month from 23.9 percent in April 2024 on rice.

Over the past three months, rice contributed about two percentage points or over 50 percent to the headline inflation.

Meanwhile, Balisacan clarified that the government can still collect substantial import duty for the Rice Competitiveness Enhancement Fund (RCEF) despite the approval of the program.

He noted that the RCEF was put in place to improve the competitiveness and income of rice farmers amid the liberalization of the Philippine rice trade policy that lifted the quantitative restrictions on rice imports and replaced it with tariffs. (TPM/SunStar Philippines)

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