Domestic hogs producers have strongly urged the Tariff Commission (TC) to review the extended tariff rates on imported frozen edible offal and for the Department of Agriculture to establish the first border inspection facility to minimize smuggling and misdeclaration of imported animal meats.
Producers raised these concerns to the Tariff Commission, which conducted a public hearing Wednesday, Jan. 25, to study the impact of tariff policies and programs on national competitiveness and consumer welfare. The Commission conducted the public hearing on the most favored nation (MFN) tariff rates of meat and edible offal of livestock under AHTN 2022 Headings 02.01 to 02.06, following the directive from the Office of Senator Cynthia A. Villar to the National Economic and Development Authority (NEDA) to study the existing tariff structure of meat and edible offal.
Villar wants to close the gap between tariffs for offal and muscle (good) meat to discourage smuggling. Producers alleged of misdeclaration of the two kinds of meat to avoid the higher tariff on good meat.
Signed on December 29, 2022, Executive Order No. 10 states that meat of swine, fresh, chilled or frozen, maize, rice, and coal shall be subject to the Most Favored Nation (MFN) rates of duty.
The order extends the reduced rates of duty for one year or until December 2023 on the following commodities: meat of swine, fresh, chilled, or frozen at 15 percent (in-quota) and 25 percent (out-quota); corn at 5 percent (in-quota) and 15 percent (out-quota); rice at 35 percent (in-quota and out-quota); and coal at zero duty.
Jess Cham, president at Meat Importers and Traders Association (MITA), has asked the TC to reduce the rate on beet meat and beef offal to five percent, maintain the current rate on pork meat for the next five years; and reduce the rate on por offal to five percent.
Chester Tan, president of National Federation of Hog Raisers, said that there is no need to extend the low tariff rate on imported meat because tariff has not really been effective in reducing prices of commodities.
He said that when the EO on agricultural tariff was first extended in 2022, the producers lost a lot because they invested to prepare for bigger production already. They thought it was the last extension that they again prepare for bigger production this year only to learn that the lower tariff on imported meat is again extended for a year.
The Commission, however, assured the producers that the EO is specific on the extension being temporary and therefore up for review. The body, however, cannot assure when the review would happen as the extension just took effect recently.
Another issue being debated by producers and importers is the first border facility. Local hog producers said the Department of Agriculture failed to implement the P2.5 billion budget for the construction of the facilities. The proposal is to build one each in Manila, Davao, Cebu, Batangas, and Subic.
Traders, however, said that while there is no physical first border facility, they still undergo first border inspection process at the cold storage facilities.