Gov't starts tariff review

The Tariff Commission on Monday said it would take into account local production, employment and state revenues in deciding which tariffs to change in the new listing for 2011 to 2015. The commission has started public consultations in preparation for the drafting of a new five-year tariff structure that will replace Executive Order 574, which expires by yearend. "We will look at the availability of the product. If it is locally produced, then maybe it needs a little protection. If not, maybe it doesn't need tariff protection anymore," Tariff Commission Chairman Edgardo C. Abon said at the marathon hearing that ends on Friday. Tariffs may also be lowered for imported products used as raw materials, he said. But the decision may swing the other way if companies have committed or plan to sink in investments to manufacture that material locally, he said. The product's trade balance will also influence possible tariff revisions, especially if it already has an export market, Abon said. "If we are a net exporter [of a certain product], then it is competitive and [may no longer need tariff protection]," he said. Revenue implications and employment would likewise be reviewed, Abon said. Firms and industry groups, he said, should submit position papers within two weeks after their products are taken up in hearings this week. "We will submit our recommendation to the [interagency Committee on Tariff and Related Matters] by April to May. But the current administration will shy away from making a decision," Abon said, noting that the incoming President after the May elections would have to decide how tariffs should support development plans. In the last review held in 2006, 96 percent of the tariff lines were maintained, according to earlier reports. The rest were lowered or raised. There are 8,986 tariff lines up for review, with nearly two-thirds of these with duties at 0-5 percent, Abon said. — Jessica Anne D. Hermosa, BusinessWorld