Marcos’ economic managers eyeing extension of reduced tariffs amid high inflation

The economic managers of the Marcos administration are working for an extension of the reduced tariff rates on imported pork, rice, corn, and coal to help slow down inflation, Socioeconomic Planning Secretary Arsenio Balisacan said on Wednesday.

Then President Rodrigo Duterte in May issued Executive Order No. 171 which extended until the end of 2022 the reduced rates of import duties on pork, rice, corn, and coal as the Russia-Ukraine war pushed global prices.

“This inflation continues to be a problem so we have to make sure that we don’t go to a higher tariff regime as prices are going up,” Balisacan told reporters at the sidelines of the 48th Philippine Business Conference and Expo in Manila.

Under EO 171, the tariff rate for both in-quota and out-quota pork shipments were kept at reduced rates of 15% (from 30%) and 25% (from 40%, respectively.

The EO also kept the lower tariff rates for rice at 35% for both in-quota and out-quota imports as well as the reduced duty for corn shipments at 5% (from 35%) for in-quota and 15% (from 50%) for out-quota.

The order, likewise, temporarily removed the 7% tariff on coal imports.

Balisacan said the validity period of the EO 171 will be possibly extended.

“It’s possible. That’s the easiest way. But that still has to go through the process,” Balisacan said.

He said the length of the extension was still being studied.

Baliscan said the Cabinet-level Committee on Tariff and Related Matters (CTRM) would start working on the consultation process concerning the planned extension of the EO 171.

“They have to complete it before the end of December. Otherwise, we’ll move to a higher tariff regime,” Balisacan said.

The CTRM is chaired by the secretary of Trade and Industry and co-chaired by the chief of the National Economic and Development Authority. Its members include the Executive Secretary as well as the secretaries of Finance, Budget, Labor, Agriculture, Agrarian Reform, Foreign Affairs, Environment, the government of the Bangko Sentral ng Pilipinas, and the chairman of the Tariff Commission.

“As we are seeing now that prices continue to be elevated, it’s not the right time to get those tariffs up,” Balisacan said.

In September, inflation—the rate of increase in the prices of consumer goods and services—accelerated to 6.9%, its highest level in four years, due to continued increases in food and utility costs.

This brought the year-to-date inflation rate to 5.1%, within the government's 4.5% to 5.5% target range for 2022. —NB, GMA News