Senator Cynthia Villar on Thursday raised concerns over the involvement of farmers’ cooperatives and irrigation associations in the importation of a significant volume of rice into the country.
“The most pressing question now is: Are these farmers’ cooperatives/ associations actually capable by itself to import such a large number of rice into the country, or is there a dummy arrangement behind the scenes?” Villar asked.
She expressed her concern as the Senate Committee on Agriculture, which she chairs, conducted a hearing on the resolution seeking to improve the government procedures for rice importation amid claims that rice traders and importers are using cooperatives to skirt the Rice Tariffication Law.
At the opening the inquiry, Villar, citing her research, said that farmers’ cooperatives and associations imported 1.017 million metric tons (MT) of rice in 2019, when the Philippines was tagged as the world’s biggest rice importer.
For 2020, the latest data showed that farmer cooperatives/ associations have so far imported 632,431.31 MT, she said.
Villar also found that most importers of rice came from top rice-producing provinces such as Nueva Ecija, Pangasinan, Tarlac, and Mindoro Occidental, which “receives [sic] full support from government in terms of agricultural inputs and training to make their rice farmers competitive.”
Forty-three of these farmer’s cooperatives were from Bulacan, 20 were from Mindoro Occidental, 17 from Tarlac, another 17 from Nueva Ecija, 12 from Pangasinan, 10 from Ilocos Norte, and another 10 from Pampanga.
There were 29 farmers’ coop in the top 50 companies that imported rice in 2019.
In 2020, 18 out of the top 50 rice importers were farmers’ coops.
According to the Bureau of Plant Industry (BPI), an agency attached to the Department of Agriculture (DA) and in-charge of issuing import clearances for rice, there are 507 importers and 156 cooperatives and associations registered with them as of Oct. 9.
Villar reiterated that unscrupulous rice traders take advantage of the tax benefits given to farmers’ cooperatives to evade tariffs, citing Republic Act No. 9520 or the Philippine Cooperative Code of 2008.
The Department of Finance (DOF) and Bureau of Customs (BOC), however, said that the farmers’ groups are not exempted from paying custom duties and taxes.
“Just to clarify, we confirm that per the CMTA (Customs Modernization and Tariff Act of 2016) and our existing rules and regulations, the cooperatives are not exempted,” BOC chief Rey Leonardo Guerrero said, assuring senators that there are “no benefits attached to rice importation thru the coops.”
In a budget hearing last Oct. 16, DA Secretary William Dar said the agency will soon issue an order prohibiting cooperatives from importing rice.
“We are now preparing an administrative order to remove from eligible rice importers the cooperatives and irrigators’ associations. That will come out as an administrative order,” Undersecretary Rodolfo Vicerra reassured senators Thursday.