The Tariff Commission (TC) has launched its investigation to determine the merits of increasing the tariff on pork imports to as high as 44 percent.
In a notice published on its website recently, the TC said it is conducting the investigation after the Samahang Industriya ng Agrikultura (SINAG) filed a petition before the agency to increase the in-quota pork tariff rate to 40 percent and out-quota rate to 44 percent.
Currently, pork imports within the minimum access volume (MAV) and outside of MAV are slapped a tariff of 30 percent and 40 percent, respectively.
The TC, an attached agency of the National Economic and Development Authority, said interested parties may submit their comments, inputs, and/or positions on the proposed tariff modification on or before May 7.
The agency, however, disclosed that the schedule of the public hearing for the petitioned “will be announced at a later date.”
The investigation is being conducted after the government’s decision to reduce the tariff on pork imports to as low as 5 percent via Executive Order 128 issued by the President was opposed by lawmakers and local producers.
The group first floated their proposal to increase the tariffs on pork imports as a way of “shaving off” traders’ profits and to boost government’s tax collection in March.
SINAG proposed the tariff hike in a letter to TC Chairperson Marilou P. Mendoza. However, Mendoza told the group that the agency is “constrained” to put the tariff hike petition on hold until the petition made by the Department of Agriculture to lower pork tariffs was resolved.
The group claimed that “importers are raking in profits at the current tariff rate with no corresponding reflection on the retail price of prime pork cuts.”
Citing Bureau of Customs (BOC) data, the group said the landed cost of pork belly and kasim is P81 per kilogram from January 2020 to 2021. The group argued that at these prices, importers are making P200 to P250 per kilogram as pork belly and kasim retail for P350 to P400 per kg.
“As late as January to February this year [2021], when retail prices of local pork spiked, imported pork was being sold between P350-450/kilo. Importers claim that they are not violating any law and are just following the retail price of pork,” the group said in its letter to Mendoza last March.
The group said increasing the tariff rates would mean higher revenues for the government, especially since the Duterte administration’s economic blueprint is “anchored on additional government funds to support its accelerated spending” for infrastructure and social services programs.
“Reducing tariffs will deprive the government of much needed revenues. Revenues that would support the Covid-19 vaccination program and efforts to help the livestock industry recover from the African Swine Fever [ASF] pandemic.”
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