PORK IMPORTS surged in the first two months of the implementation of lower tariffs, the Finance department said on Tuesday.
However, the lower tariffs resulted in over P1.3 billion in revenue losses for the Bureau of Customs (BoC).
The Department of Finance (DoF) said pork imports jumped by 500% to 24.45 million kilograms (kg) in April from just 4.07 million kg in the same month last year, citing a report by Customs Commissioner Rey Leonardo B. Guerrero.
Pork imports further increased to 36.5 million kg in May, which was 506% higher than the 6.02 million kg a year ago. Another 15.14 million kg in pork imports were brought in during the June 1-11 period.
“For the period April 9 to June 11, 2021, the BoC posted a total collection of P846.96 million. We estimated the revenue losses from Executive Orders (EO) 128 and 134 to have reached P1.356 billion for this period,” Mr. Guerrero said.
EO 128, which took effect from April 7 to May 14, temporarily lowered the tariff rate on pork imports to 5% for shipments within the minimum access volume (MAV) threshold and 15% for those outside the quota, from the previous rates of 30% and 40%, respectively.
This order was amended by EO 134, signed by President Rodrigo R. Duterte on May 15. It lowered the tariff on pork imports within the MAV quota to 10% in the first three months and 15% over the subsequent nine months. Out-of-quota pork imports were to be charged 20% and 25% over the first three months and subsequent nine months, respectively.
Mr. Duterte also signed EO No. 133 that increased the MAV quota of pork imports to 254,210 metric tons (MT), from the previous 54,210 MT.
Finance Secretary Carlos G. Dominguez III had estimated that the government stands to lose P11.2 billion in duties and taxes this year due to the reduced tariffs on pork imports.
Customs data showed in-quota pork imports totaled 10.46 million kg in April, 10.47 million kg in May and 2.78 million kg. in the early part of June.
The DoF said consumers will likely save P50.1 billion from lower pork prices and subdued inflation following the tariff cut, citing data from the National Economic and Development Authority (NEDA).
However, consumers haven’t felt the promised lower market prices yet since pork prices remained high at P370 per kg based on Agriculture department data, while farmgate prices stood at P235 per kg, Laban Konsyumer, Inc. President Victorio A. Dimagiba said in a Viber message on Tuesday.
“Imported frozen pork [prices] are lower at P270 a kg. These numbers were taken out from the Tariff Commission hearing last week,” he said.
Mr. Dimagiba said there is still room to further reduce the prices of local hogs and align these with frozen pork prices, but so far, the government’s move to reduce the tariffs is “hardly” addressing the issue of supply-side driven inflation for these meat products.
Headline inflation rose by 4.5% year on year in April but this slightly eased to a six-month low of 4.1% in June. — Beatrice M. Laforga