DTI chief wants tariffs on oil, galvanized iron scrapped

To cushion the country from higher prices of oil and galvanized iron, Trade Secretary Jesli Lapus said Tuesday his department is asking the National Economic and Development Authority (NEDA) to scrap the 3-percent tax on crude oil and refined petroleum products and the 7-percent tax on rolled coil steal. "We expect pump prices to drop. It would help stabilize prices and lower inflation. Revenue loss will be revenue gained by the public. Bawas naman sa (It reduces the) cost of living," Lapus said in a press briefing in Angeles City, Pampanga. President Gloria Macapagal-Arroyo chairs the NEDA board, while Lapus chairs the Cabinet committee on tariffs and trade-related matters. Lapus made the recommendation despite the 50-centavo rollback in diesel, kerosene and gasoline prices implemented by oil giants Pilipinas Shell Petroleum Corp., Petron Corp., Chevron Philippines Inc., and independent players Flying V Philippines, Seaoil Philippines Inc., and Eastern Petroleum Corp. Philippines Tuesday. With rising iron ore prices in the international market, Lapus said he would recommend that the tariff on hot and cold rolled galvanized iron sheets be removed. He added that order would be effective until the production of Global Steel Philippines Inc. (GSPI), the country’s largest steel mill, is enough to meet domestic demand. The government would forgo tariff revenues of about P5 billion in oil and P460 million in galvanized iron with the zero tariffs on these products, Lapus said. He noted that rolled coil steel prices rose to $600 per metric ton and could rise to $800. Lapus also said government would no longer need the services of GSPI, operator of the Iligan City steel plant and formerly known as the National Steel Corp. A Board of Investments study showed that the GSPI was hounded by lack of capital and declining market acceptance that its output declined from 2006 to 2008. Also, its hot-rolled coil steel production in the four years from 2006 was unstable. —VS, GMANews.TV