Senate sends rice tarrification bill to the Office of the President

January 16, 2019

A measure that will allow unimpeded importation of rice, amending the Agricultural Tariffication Act of 1996 and replacing the quantitative restriction on rice imports, is now a President's signature away to become a law.

The Senate on Tuesday transmitted to the Office of the President the harmonized version of Senate Bill 1998 and House Bill 7735, or an "Act Replacing the Quantitative Import Restrictions on Rice with Tariffs, Lifting the Quantitative Export Restrictions."

The measure, which was ratified by both Houses of Congress in November last year, would lapse into law if Duterte failed to act on it after 30 days.

President Rodrigo Duterte's economic managers have identified rice tariffication as one of the means that would help address soaring inflation.

The measure would create the Rice Competitiveness Enhancement Fund (RCEF) as a special rice safeguard duty to protect the rice industry from sudden or extreme price fluctuations.

"One of the key features of the bill is the creation of the Rice Competitiveness Enhancement Fund, which shall consist of initial appropriation of P10 billion a year until all duties collected from the importation of rice can replace it," said Sen. Cynthia Villar, sponsor and principal author of the bill.

The Senate agreed on setting the RCEF at a minimum P10 billion a year for six years, and tariff revenues in excess of P10 billion shall be appropriated by Congress based on a menu of programs in the rice tariffication law.

The fund will be utilized to provide different forms of assistance to the country's rice farmers such as the development of inbred rice seeds for our farmers, the development of rice farm equipment and skills enhancement.

Villar noted that the staple grain is the only agricultural commodity in the country that has a quantitative restriction (QR), limiting the inflow of imported rice in the country.

This would in effect remove all unnecessary intervention of the government in the rice market, as recently announced by Duterte, Villar said. DMS