Sugar producers buck liberalization, tax hikes
MANILA -Local sugar groups are opposing the proposal to liberalize the importation of the sweetener, saying the government should instead provide additional support to the struggling industry.
“What sugar producers need is more government programs to boost our production and lower our production costs, and more conducive import and taxation policies, which supports and protects our farmers,” Aurelio Gerardo Valderrama Jr., national president of Confederation of Sugar Producers Associations (Confed), said in a statement.
He added that while Confed recognizes the need to generate more revenues to boost government coffers, it should not be done at the expense of local sugar producers.
For its part, Cocoy Barrera, executive director of Philippine Sugar Millers Association (PSMA), said the liberalization of sugar imports “would lead to the demise of our industry.”
“Not only will the excise tax on sugar-sweetened beverages be raised, but also in succession, beverage producers will be granted permission to bring in foreign-produced sugar to offset the increase in cost stemming from the higher excise tax,” Barrera said.
Both Confed and PSMA expressed their gratitude to lawmakers for filing a resolution opposing the Department of Finance’s proposal to allow food and beverage manufacturers to directly source sugar, considering its negative impact on the sector.
“The domestic sugar industry has been starved of the much-needed government support,” House Resolution No. 1199 said.
“Instead of remedying this injustice, the DOF proposes to liberalize sugar importation that will further compound the ills of the domestic sugar industry,” it said.
The resolution cited a 2021 study commissioned by the National Economic and Development Authority (Neda), which stated that deregulating sugar importation “would favor the rich more than the poor” at “a clear cost” to industry stakeholders.
The Neda study recommended a gradual and partial sugar trade liberalization amid severe distortions in the global sugar market.
It said there was a “modest” gain to overall society of P2 billion or 1.8 percent from full sugar liberalization.
“Fully liberalizing trade in sugar would predictably hurt planters and millers whose profits are projected to decline by 57 percent, while consumers gain in welfare by up to 65 percent,” the study said.
