New extension of reduced tariffs sought by Marcos' economic team

The Marcos administration’s economic team has recommended the extension of the effectivity of the reduced import duties on various commodities until the end of 2024 as inflation remains elevated, National Economic and Development Authority (NEDA) Secretary Arsenio Balisacan said Friday.

“As economic managers, we need to extend that until prices in the world market have eased up,” Balisacan told reporters at a briefing in Pasig City.

The NEDA chief was referring to the Inter-agency Committee on Inflation and Market Outlook’s (IAC-IMO) recommendation to extend the lower tariff rates under Executive Order No. 10, which is set to expire by December 31, 2023.

The IAC-IMO is a body created by Marcos Jr. to craft strategies to mitigate inflation in the country and to keep it within the government’s target range of 2% to 4%.

The inter-agency body is co-chaired by the secretaries of the Department of Finance (DOF) and the National Economic and Development Authority (NEDA), while the Secretary of the Department of Budget and Management (DBM) serves as the vice-chairperson.

Members of the IAC-IMO include the Department of Agriculture (DA), Department of Energy (DOE), Department of Science and Technology (DOST), and Department of Trade and Industry (DTI).

The IAC-IMO's recommendation came on the heels of the faster September inflation at 6.1% from 5.3% in August, with rice being the main culprit --recording a 14-year high inflation rate of 17.9%.

Signed on December 29, 2022, President Ferdinand "Bongbong" Marcos Jr. issued Executive Order No. 10, which extended until December 31, 2023 the reduced tariff rates on the following commodities:

• Meat of swine, fresh, chilled, or frozen at 15% (in-quota) and 25% (out-quota)
• Corn at 5% (in-quota) and 15% (out-quota)
• Rice at 35% (in-quota and out-quota)

While the recommendation was to extend the lower tariffs until the end of December 2024, Balisacan said it  subject to review in July 2024. 

The NEDA chief added that extending EO 10 would need to undergo several processes such as hearings by the Tariff Commission.

“There’s a process we have to follow,” Balisacan said. 

The country’s chief economist emphasized the need to extend the lower tariff rates on the various imported commodities as global prices remain “very much elevated.”

“They will go back to [previous] levels which in the case of corn, rice, and meat they will go substantially higher,” Balisacan said.

Based on the EO 10, the tariff rate for meat will go back to 30% (in-quota) and 40% (out-quota); for corn,  the rate will revert to 35% (in—quota) and 50% (out-quota); while for rice, the tariff will return to 40% (in-quota) and 50% (out-quotation).

The EO 10 extended further the EO 171, issued by former President Rodrigo Duterte, which extended the effectivity of the reduced tariff rates under EO Nos. 134 and 135, and reduced the tariff rates on cord and coal until December 31, 2022.

Meanwhile, EO Nos. 134 and 135 temporarily modified the rates of import duty on meat of swine (fresh chilled or frozen) until May 17, 2022 and rice until June 1, 2022. —NB, GMA Integrated News