THE government’s rice tariff collection from January to July this year settled at P10.5 billion, down from last year’s P11.03 billion as imports fell by more than nine percent.
Preliminary Bureau of Customs (BOC) data obtained by BusinessMirror showed 1.54 million metric tons (MMT) of rice were imported into the country during the seven-month period, a 9.3-percent decline from last year’s 1.7 MMT.
Despite this, the average value of rice imports from January to July went up by 4.8 percent to P20,242 per metric ton (MT) from P19,312 per MT.
Meanwhile, Customs data also showed rice import volume and rice tariff collection began picking up in July this year after four consecutive months of year-on-year decline for both metrics from March to June.
For the month of July, rice tariff collection soared to P1.62 billion, a 66.5-percent jump from P967 million in the same month last year.
The volume of rice imports in July also rose 68.9 percent to 249,963.7 MT from 147,983.97 MT last year.
Asked why the bureau’s rice tariff collection was lower during the seven-month period, Customs Assistant Commissioner and spokesman Vincent Philip Maronilla said the bureau is still looking into it.
“One factor is volume, but then again that is just one factor,” Maronilla told BusinessMirror.
Valuation issues
The BOC is also looking into valuation issues on rice shipments from January to June this year. Customs Commissioner Rey Leonardo Guerrero earlier ordered the transaction audit after the bureau noticed that most of the rice imports from Vietnam were declared with values lower than the published prevailing prices for exports from that country.
Maronilla, who also heads the bureau’s Post-Clearance Audit Group, told BusinessMirror that the agency’s transaction audit will now cover 29 rice importers, up from 23.
To recall, President Duterte’s Executive Order (EO) No. 135 which paved the way for temporary lower Most Favoured Nation (MFN) tariff rates on rice imports also took effect on June 2. The EO reduced the MFN tariff rates for rice to 35 percent from 40 percent (in-quota) and 50 percent (out-quota) for a period of one year.
Malacañang earlier cited a need to lower tariff rates for rice imports to offset the expected 10-percent shortfall in the local supply of rice this year.
The Federation of Free Farmers has said lowering the rice tariff rates may result in a revenue loss of around P100 million in customs duties, or more, if import volumes from non-Asean countries increase due to the tariff reduction.
However, the Tariff Commission earlier said in its investigation report obtained by the BusinessMirror that the Philippines stands to lose P60 million in revenues due to the rice tariff rate cut to 35 percent.
Tariffs collected from rice imports are used to fund the six-year P10-billion annual Rice Competitiveness Enhancement Fund to bankroll programs that provide farmers with high-quality seeds, machinery, easier credit access, and relevant training. This is meant to improve their productivity and become competitive.
Should annual tariff revenues from rice imports exceed P10 billion, the Rice Tariffication Law mandates earmarking the fund by Congress—and included in the national budget of the following year—for financial assistance to palay farmers, titling of agricultural lands, an expanded crop insurance program on rice, and crop diversification.
Last year, the government collected P15.47 billion from 2.38 MMT of rice imports.
In 2019, Customs’s rice tariff collection amounted to P12.3 billion from 2.03 MMT of rice imports from March to December following the passage of the law.