DA presses hike in tariff on imported vegetables

The Department of Agriculture (DA) is stepping up its efforts to push for an increase in the tariff rates imposed on imported vegetables from seven percent to 40 percent.

DA officials said the department is currently initiating moves to have the Tariff Commission fasttrack the hearing on its proposal so that the new tariffs could be enforced immediately.

The proposed tariff hike which aims to protect local farmers from the onslaught of imported agricultural commodities, should have been enforced last Jan. 1 based on the schedule of the Common Effective Preferential Tariff (CEPT) scheme of the ASEAN Free Trade Area (AFTA).

"We want to keep tariff rates stable and within bound-rates," said newly appointed Agriculture Undersecretary Arsenio Balisacan.

Balisacan said the increase in tariff rates is critical to the ailing domestic vegetable industry which is reeling from the influx of cheap vegetable imports and uncurtailed smuggling of goods that have found their way into wet markets.

"The tariff rates can spell the industry’s survival and at this point, can seriously affect its growth prospects," said Balisacan.

The DA’s proposal if approved, would jack up the applied seven percent tariff on a number of imported vegetables and rootcrops to the maximum World Trade Organization (WTO) bound rate of 40 percent.

Applied rates are the actual duties imposed on non-ASEAN imports while bound rates refer to the highest tariff that a country can impose on a certain product in line with its commitment to the WTO.

Earlier, Agriculture Secretary Luis Lorenzo Jr. said he wants to apply the maximum 40 percent outbound rates, stressing that local vegetable farmers need the reprieve while they are still preparing for the eventual breaking down of tariff walls and opening up to foreign competition.

Agriculture Assistant Secretary Segfredo Serrano said this move if approved, should be good for the agriculture sector especially with the proposal of the US to impose new tariffs based on the applied or current rates rather than the bound rates.

"If we are able to get approval to apply the bound rates now, that should still give us room when the developed countries’ proposal to further break down tariff walls is imposed. We will have protection unlike if the applied or current rates are the imposed. We will still have protection unlike if the applied or current rates are the starting point for the implementation of proposed new tariffs, then that would really wipe us out because our tariffs are already very low," Serrano said.

Lorenzo added that the DA will also push for the inclusion in the so-called "sensitive list" agricultural products such as leeks, cauliflower and headed broccoli, Chinese cabbage, lettuce, chicory, carrots, turnips, radishes, cucumber, green peas, snap beans, celery, red and green pepper, spinach, onions, ginger and peel of fruits and melon.

Currently sensitive agricultural products are limited to rice, corn, sugar, meat of swine and poultry and coffee. These products are levied the maximum allowable bound rates.