P1 Trillion in Revenues Lost Due to WTO Accord 

An anti-globalization alliance says the government’s fiscal crisis is all the more exacerbated because the government radically reworked the 1994 tariff rates on imported commodities, leading to a loss of P1 trillion in revenues.

BY BULATLAT

RESIST, the Philippine network of people’s organizations and sectoral groups opposed to the World Trade Organization (WTO) today said that the government’s fiscal crisis is all the more exacerbated because the government radically reworked the 1994 tariff rates on imported commodities.
 
Citing data from the Department of Trade Industry (DTI), Resist spokesperson and Bayan Muna Representative Teddy Casino, the local industries have been severely compromised because of the Macapagal-Arroyo government’s accelerated tariff reduction program which is patterned after the specifications of the WTO. This tariff reduction program has caused the national coffers a loss of some P1.079 trillion from 1995 to 2003.
 
Philippine Ambassador to the World Trade Organization Manuel Antonio Teehankee himself has conceded that the Philippines imposes one of the lowest tariff rates on imports.
 
The country’s average applied tariffs as of 2005 are estimated at eight percent for agriculture products and 4.3 percent for industrial products, he said.
 
In comparison, Thailand’s applied tariff rates are 29 percent for agricultural products and 14.2 percent for industrial products. China and India also have higher tariff rates than those of the Philippines.
 
Casino said that the Philippine government’s already callous lack of support for local industries coupled with the doing away of  tariffs and the levels of protection for locally produced products has cause many local industries to close shop.

“Because of the country’s unilateral tariff reduction scheme, the government has lost potential additional revenues of P237.82 billion in 2003 alone. This was computed on the assumption that tariff collections could have reached P332.38 billion in 2003, if tariff rates were retained at the 1994 level of 19.72 percent,” he said. 
 
Because the government lowered its average most favored nation (MFN) tariff rate to an average of 5.61 percent in 2003, the Bureau of Customs was able to collect only P94.56 billion.
 
“Yet here is the government continuing to harass the Filipino people with new taxes such as the expanded value added tax (EVAT) and exhorting them to further tighten their belts! The government is losing billions because of the WTO’s policies.

Casino said that the Philippine government should at least resist attempts by rich nations to effect huge cuts in tariff rates of WTO members through the so-called Swiss formula in the upcoming ministerial meeting in Hong Kong later this month. “If the Philippine government still has any pretenses of caring for the welfare of the Filipino people,’ he said.
 
“But more than this, the Philippines should completely get out of the WTO,” he said. “The Macapagal-Arroyo government cannot shake itself off of the responsibility for the destruction of the national economy and the worsening poverty of the Filipino people. The last two-and-a-half decades under this neo-liberal development framework and the last 10 years under the WTO has made genuine progress and development for Philippine industries and agriculture an impossibility,” he said. Bulatlat 

BACK TO TOP ■  PRINTER-FRIENDLY VERSION  ■   COMMENT

© 2005 Bulatlat ■  Alipato Publications

Permission is granted to reprint or redistribute this article, provided its author/s and Bulatlat are properly credited and notified.