DTI wants tariff on MDM kept at 5%

Meralco announced an increase of P0.316 per kilowatt-hour (kWh) for July to P10.1925/kWh from June’s P9.8789/kWh. YUMMIE DINGDING Secretary Ramon Lopez of the Department of Trade and Industry (DTI) fully supports keeping the 5 percent tariff on mechanically deboned meat (MDM), citing its benefits to the local meat processing industry.

“Looking into what’s best for the country and people, we should really keep the tariff at 5 percent in MDM,” Lopez said at the 29th anniversary of the Philippine Association of Meat Producers, Inc. (PAMPI) in Puerto Princesa City.

He said increasing the tariff on MDM would result to higher prices in processed meat and canned meat products. The increase on MDM tariff could also punish the local manufacturing sector as they lose their competitive advantage, Lopez said.

The Philippines previously lobbied to lower the tariff on MDM from 40 percent to five percent after the country waived the special treatment privilege on rice in 2012.

However, President Duterte signed Executive Order (EO) 23 that would revert tariff to their 2012 level once the quantitative restrictions (QR) on rice are lifted on January 1, 2021.

Pampi has since pushed for the decoupling of the MDM tariff from the QR on rice to keep the 5 percent tariff.

At the same time, the trade chief expressed concern over likely job losses if higher tariffs were imposed on the meat products.

“If you do that (revert to 40 percent tariff on MDM), what will happen is local manufacturers may leave or reduce operations, leading to jobs lost. They start to instead operate abroad where MDMs are 5 percent and then just export products to the Philippines at lower tariff,” he said.

He added, “That will also be unfortunate because amidst the current (high) inflation, manufactured food products (post) relatively stable prices and have not registered as major causes of the 5.2 percent inflation.”