Finance Secretary Carlos Dominguez III said tariffs in excess of P10 billion collected from rice imports and earmarked annually for the Rice Competitiveness Enhancement Fund will fund a two-year unconditional cash transfer program for small farmers affected by falling palay farmgate prices.
Dominguez, a former agriculture secretary, said in an interview the P1.4 billion in excess of rice import tariffs collected by the Bureau of Customs as of Oct. 31 this year, along with the succeeding surplus funds from RCEF for the rest of 2019 and in 2020, would be used for the P6-billion UCT program for rice farmers tilling two hectares and below.
“The P10 billion is already fixed. It already has an allocation [for RCEF]. The excess will be part of the P6 billion that will be allocated for two years for the farmers,” Dominguez said.
Agriculture Secretary William Dar earlier announced the rollout of the UCT program, which he said would cover an initial P3 billion this year and another P3 billion in 2020.
Dar said the funds would be sourced from the excess tariffs from rice imports which would also be used to support crop insurance and crop diversification programs for the benefit of farmers.
Dominguez said he was informed by Dar that the Department of Agriculture prepared a list of the farmers who would benefit from the UCTs.
Republic Act No. 11203 or the Rice Tariffication Law imposes a minimum 35-percent tariff on rice imports in lieu of quantitative restrictions. The law, which liberalized rice imports, stabilized the supply and price of the Filipino food staple in the retail market, but led to declining palay farmgate prices in certain rice producing areas.
Dominguez said earlier the RTL would be fully implemented by the Duterte administration as it pursues measures to stamp out smuggling and hoarding by unscrupulous traders to cushion the impact on both palay growers and rice consumers of the temporary “transition challenges” arising from the newly deregulated market.
He said that on top of UCTs, the government would also grant interest-free, easy-to-pay loans to affected farmers.
Dominguez said that in only seven months since it was implemented, the RTL netted tariff revenue of P11.4 billion, which is already beyond the P10 billion earmarked per year for RCEF.
He said with over P11 billion in import tariffs this early, the government “has ample means to do even more to make our agricultural production more efficient.”
Rice tariffication, Dominguez said, should be viewed as an “opportunity to revolutionize the agriculture sector and help farmers become more competitive in the global economy.”