The Department of Finance (DOF) said it may shift sourcing of imported rice from traditional markets to India, where the grain is cheaper.
The DOF also said it will focus on ensuring the effective collection of rice duties after the government amended its tariff rule on the commodity.
This after President Duterte issued Executive Order (EO) 135 last May 15, 2021, harmonizing the tariff rates on imports of the cereal to a uniform 35 percent that will run for one year, regardless of where it is sourced, to address the inflationary impact of the increasing global rice prices particularly those coming from Asean countries.
“EO 135 would enable the country to diversify its market sources for rice and maintain the stable supply and affordable price of the cereal for Filipino consumers,” said Finance Secretary Carlos Dominguez III in a statement.
Dominguez said there might be a shift in sourcing from the traditional Thai, Vietnland, Vietnam and Myanmar to other countries where the cost is much lower such as India.
Dominguez has ordered Bureau of Customs (BOC) to tighten its monitoring of tariff paid on imported rice.
Customs Commissioner Rey Leonardo Guerrero, during a recent DOF executive committee (execom) meeting, said the BOC is “now reviewing the valuation of rice shipments from Vietnam after noticing that most of the imports from there were declared with values lower than the published prevailing prices for such exports from that country.”
“We discovered that many of these importations are under a tentative assessment so we are reviewing the payments,” Guerrero said.
He said the average value of rice imports, coming mostly from Vietnam, dropped 12.7 percent to P19,312 per metric ton (MT) in May 2021, compared to P22,119 per MT in the same month last year.
The average value of rice in May was also lower than the P21,066 per MT recorded in April and P22,119 per MT in March.
In previous execom meetings, Guerrero had reported increasing tariff collections despite lower import volumes because of a steady improvement in the BOC’s valuation system.
Preliminary data showed that from January 1 to April 30, a total of 804,360 MT of rice shipments worth P17 billion entered the country, down 9.2 percent from the 885,645 MT last year worth P16.4 billion.
BOC revenues collected from cereal imports in the four months reached P5.67 billion, up 3.7 percent from P5.46 billion collected for the same period last year, despite lower import volumes.
Guerrero said from an average of P18,508 per MT recorded in the four-month period in 2020, the average value of rice imports rose 14 percent to P21,096 per MT this year.
In September last year, the BOC subjected several rice importations to “post-modification and post audit” to ensure that undervalued shipments are properly assessed and subsequently paid with the correct amount of duties and taxes.
At the height of the strict quarantines imposed last year because of the coronavirus pandemic, the BOC eased the entry of rice imports into the country by allowing traders to move their goods while documentation is in-process to help ensure the stable supply of rice in the market.
The BOC however later discovered that the valuation of several rice shipments with provisional goods declaration are low compared to the prevailing market prices, prompting a post-audit of the imports.
