₱245-B new revenues from 5% additional tariff on imports eyed
Published May 25, 2020 12:00 am
By BERNIE CAHILES-MAGKILAT
The government could generate ₱245 billion in new revenues once it makes good its plan to impose 5 percent additional tariff on all imported products, according to the initial estimate of the Department of Trade and Industry (DTI).
Ceferino S. Rodolfo
DTI Undersecretary Ceferino S. Rodolfo, who is also managing head of the Board of Investments, said the estimated P245-billion additional government revenue from the DTI plan was based on the average imports between 2016-2018, which was lower than 2019.
The BOI and DTI recommended this plan to the Department of Finance (DOF) to help raise new money for the government following the huge capital requirement needed to fight COVID-19.
Rodolfo, however, said the DOF was not so keen yet on using tariff for revenue generating measure, but once this is agreed this will be discussed at the Tariff and Related Matters (TRM) committee. The points to be addressed regarding new tariff imposition is on its timeliness considering that importation has slowed down globally and this might further aggravate the already difficult situation among domestic industries.
On one hand, Rodolfo said, it could be that the additional tariff is all the more necessary to protect local industries.
The only concern the DTI is looking into is the country’s international commitment like the World Trade Organization, which frowns upon unilateral imposition of tariffs and other trade barriers to ensure against trade protectionism. Such unilateral move could also trigger trade retaliatory responses from other trading partners.
But Rodolfo also noted that since the plan new 5 tariff cannot be considered a protectionist move on the part of the Philippines because this is across the board on top of existing tariffs on all imports from all exporting countries.
“At this point, I think there should be no backlash on us because we can justify this as an emergency measure during this COVID-19 pandemic,” he noted. Rodolfo even cited other trading partner countries, which banned have banned exports depriving other partner countries of critical products that they need.
It could be recalled that the Philippines has plans to impose safeguard duty on imported vehicles. It also notified the World Trade Organization of its intention to slap retaliatory safeguard duty on imported cars from Thailand for failure to implement a ruling on cigarette tax.
In the case of Thailand, car imports originating from this country could potentially reach 25 percent because of the 5 percent across the board, 10 percent safeguard measure, and 5-10 percent retaliatory tariff for non-compliance of the cigarette tax ruling by the WTO.
Ceferino S. Rodolfo
DTI Undersecretary Ceferino S. Rodolfo, who is also managing head of the Board of Investments, said the estimated P245-billion additional government revenue from the DTI plan was based on the average imports between 2016-2018, which was lower than 2019.
The BOI and DTI recommended this plan to the Department of Finance (DOF) to help raise new money for the government following the huge capital requirement needed to fight COVID-19.
Rodolfo, however, said the DOF was not so keen yet on using tariff for revenue generating measure, but once this is agreed this will be discussed at the Tariff and Related Matters (TRM) committee. The points to be addressed regarding new tariff imposition is on its timeliness considering that importation has slowed down globally and this might further aggravate the already difficult situation among domestic industries.
On one hand, Rodolfo said, it could be that the additional tariff is all the more necessary to protect local industries.
The only concern the DTI is looking into is the country’s international commitment like the World Trade Organization, which frowns upon unilateral imposition of tariffs and other trade barriers to ensure against trade protectionism. Such unilateral move could also trigger trade retaliatory responses from other trading partners.
But Rodolfo also noted that since the plan new 5 tariff cannot be considered a protectionist move on the part of the Philippines because this is across the board on top of existing tariffs on all imports from all exporting countries.
“At this point, I think there should be no backlash on us because we can justify this as an emergency measure during this COVID-19 pandemic,” he noted. Rodolfo even cited other trading partner countries, which banned have banned exports depriving other partner countries of critical products that they need.
It could be recalled that the Philippines has plans to impose safeguard duty on imported vehicles. It also notified the World Trade Organization of its intention to slap retaliatory safeguard duty on imported cars from Thailand for failure to implement a ruling on cigarette tax.
In the case of Thailand, car imports originating from this country could potentially reach 25 percent because of the 5 percent across the board, 10 percent safeguard measure, and 5-10 percent retaliatory tariff for non-compliance of the cigarette tax ruling by the WTO.