THE government should raise taxes and customs duties if it really wants to lift the quantitative restriction (QR) on rice, which is set to expire next year, Deputy Speaker Gloria Macapagal- Arroyo of Pampanga said.
The former president, who backed the proposed lifting of the rice QR, said the revenues collected from taxes and customs duties can be used to assist rice farmers.
“I am for lifting [the QR]. I think lifting would be more sound. But we have to raise taxes and custom duties and then they can earmark the increase in tax collection to the promotion of rice industry,” Arroyo told the BusinessMirror.
Earlier, an official of the National Economic and Development Authority (Neda) said the agency would recommend to the President a tariff ranging from 40 percent to 50 percent for rice imports once the QR is lifted.
While some economic managers have been vocal about scrapping the rice import quota, the Cabinet and the President have yet to agree on whether the government would finally go for lifting the QR.
Rep. Josephine Y. Ramirez-Sato of the Lone District of Occidental Mindoro, a vice chairman of the House Committee on Economic Affairs, said the government’s economic managers should make up its mind whether it would seek an extension of the rice import quota.
Also, Sato said amending Republic Act (RA) 8178, which retained the QR on rice, must be a priority of the current administration if it plans to extend the nontariff trade barrier as it will expire on June 30, 2017.
However, a measure amending RA 8178 has yet to be filed in the 17th Congress.
Nacionalista Party Rep. Luis Raymund F. Villafuerte Jr. of Camarines Sur said in a statement that the Duterte administration should help palay farmers boost their yields and cut production cost first before scrapping rice-import quotas.
If the QR is finally lifted, Villafuerte said, “palay farmers will be at the losing end” because their produce cannot compete with cheaper rice imports.
“Is there any guarantee that the entry of cheap rice imports would lower the price of rice in the market? The government should provide safety nets to our farmers by, among others, helping them cut production, as well as distribution, costs and other postharvest expenses,” he added.
One way to help farmers, Villafuerte said, is to abolish irrigation fees and restructure the unpaid ones to make it easier for farmers to pay off their debts, while keeping the high tariffs on rice imports.
Sato agreed with Villafuerte, saying the extension of the rice-import quota is “a must” for farmers.
The government must also step up its efforts to roll out a program to help rice farmers, considering that the rice QR would expire in six months, she said.
“If they are going to seek an extension of the rice-import quota, I suggest they do it now. If not, they should come up with a concrete plan and put in place programs that will shield our farmers from cheap, imported rice flooding the market with the lifting of the rice-import quota,” Sato said.
The lawmaker said the government should deviate from the business-as-usual mode and put in place more safety nets for farmers, particularly those with small landholdings.
She said direct support to farmers in the form of seedlings and fertilizer subsidies; free irrigation; capacity-building programs and training to improve production, packaging of rice products; and access to emerging market chains are essential.
The government, she said, should also construct more postharvest facilities, which include dryers, milling and storage “We should ensure better yield and increase farmers’ incomes,” Sato added.
According to her, governments from where the Philippines import their rice provide subsidy to their farmers, enabling them to produce quality rice at cheaper cost.
While consumers would generally benefit from cheaper rice imports, she said local farmers would not be able to compete against their counterparts in neighboring countries because of the high cost of production.
Destruction caused by flood and typhoons, she added, aggravates the situation of small farmers with limited capital.
Sato said she is worried that the lifting of the QR on rice would force farmers to shift to planting other crops, or worse, give up farming.
“The unrestricted or unregulated importation of rice would not only affect farmers, but would also slow down agricultural production, affecting the country’s economic growth,” she said.
“By now, the Department of Agriculture [DA] should have a plan; put more safety nets that would shield our farmers from this looming crisis,” Sato added. Sato said the DA should come up with ways to make the business of rice farming more profitable.
Upon the Philippines’s accession to the World Trade Organization (WTO), the country was allowed to impose the QR on rice for 10 years. When it expired in 2004, the Philippines was able to extend it until 2012. Manila obtained another extension in 2014.
1 comment
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Hiking tariffs on rice import is not a viable solution. This just earn us a slap in the face from the WTO nor is continued importation an answer too.
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What is needed is to adjust the FOREX to U$1 – PHP 65.
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But then, does the current administration have the Steel Balls for doing so?
That was rhetorical.
Such a US1 – PHP65 FOREX policy move will entail a counter from the following:
Oil Corp who will see their import cost increase.
Black market oil importers – oil smugglers who will struggle for U$
Giant Mall operators, who makes a ton of money from over very cheap import and who over price their retail sales
Binondo Rice Cartel, who will see their cost go up.
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etc etc.
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tsk!
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