By Billy Begas
House Committee on Ways and Means chairperson and Albay Rep. Joey Salceda on Thursday appealed to President Rodrigo Duterte to reconsider his decision to lower the tariff on imported pork meat.
Salceda agreed that there is a need to lower the meat inflation but lowering the tax imposed on imported meat will only harm the domestic industry while benefiting primarily importers and traders.
“The price differential between imported pork at around P190 after duties, and the domestic price of around P300-400 a kilo is enough incentive to import. What we need to do is ensure that imports that come in are safe, and that the application process for the in-quota tariff rate is not tedious or expensive,” Salceda said.
Duterte has approved lowering import duties on pork meat from 40% to 15% for out-quota pork, and from 30% to 5% for in-quota pork imports.
“It’s naïve to think that traders will sell at lower prices just because imports are priced more cheaply. They are already pocketing up to 110% in gross margins. What would stop them from just taking more?” Salceda added.
Salceda said “domestic industry suffers at a higher rate than the price level goes down.”
He cited as an example the rice tarrification law “where farmers took a bigger price cut for their produce than the average consumer saved in rice prices.
“While I support the overall policy of easing trade to lower consumer prices, we should have precautions to help domestic industry,” he pointed out.
Salceda said the government will lose P1.9 billion in revenues from the lowering of tariffs.
“The better answer, I believe, is to use tariff revenues to improve our swine repopulation program and invest in biosafety and better feeding. That way, we can overcome the scourge of ASF, which comes from swill feeding and unsafe imports,” Salceda said.
Some 71% of swine production in the country comes from small backyard raisers.
“Ordinarily, lowering tariffs is a power of Congress, that should specifically originate in my Committee. NEDA could have at the very least asked my Committee to clear the final decision, because they’re borrowing my Committee’s power. And it’s very hard to reverse decisions like these,” said Salceda.
“I don’t appreciate that we were not given the opportunity to formally weigh in, especially when the economic team always gets priority of hearing in my Committee. At least, President Duterte could have had more alternatives presented to him. I will of course continue to work with them openly and productively, but I’m disappointed,” he added.
Salceda said he appreciate that the lowering is time-bound and gradually phased out, before completely reverting to original tariff levels after 12 months.
“If the policy does not work to lower prices, though, I would urge him to reverse the policy. We in Congress can also work with his economic managers for a viable alternative,” Salceda pointed out.