Gov’t stands to lose P5.4B by year-end due to pork tariff cut
The temporary lowering of the tariffs on imported pork, which was aimed at taming inflation, will cost the government P5.4 billion in foregone tax revenue by the end of this year, the Department of Finance said.
Finance Undersecretary Antonette Tionko told reporters that Executive Order (EO) No. 134, which slashed pork import duties and increased quotas, had already resulted in P2.52 billion in revenue losses since it was implemented in April.
The government has also lost so far P11.4 million in tax revenue due to the reduction in the tariff on rice imported from outside the Association of Southeast Asian Nations (Asean). EO No. 135, which provided for this tariff adjustment on rice, took effect in June and will lapse by June next year, when the amount of foregone revenue is expected to hit P40.9 million, Tionko said.
Finance Secretary Carlos Dominguez III pointed out that “the loss of revenue blunted the increase in the prices of pork,” in the case of EO No. 134. Pork prices had steadily increased in late 2020 up to early this year due to the African swine fever crisis.
“It (EO No. 134) has really stopped the increase in [pork] prices by adding more supply,” Dominguez said. “We are looking at the health of the entire economy and the welfare of the people. It’s worth it to lose some revenue so that people’s food costs will not increase.”
As for EO No. 135, Dominguez said it was “common sense” to slash the most-favored nation tariffs slapped on rice imports outside Southeast Asia.
“We are one of the biggest rice buyers in the world, and why should we leave it ourselves to buy only from [the Asean region]. Vietnam buys a lot of rice from India. Vietnam is actually buying a lot of broken rice from India. They make that into noodles, and then they consume and export their good quality rice. It’s just international trade; you [get your supply] from where it’s cheapest,” the Finance chief said.
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