Philippines officially reduces rice import tax to 15%

On June 20, 2024, based on the authority granted by law and the recommendations of relevant agencies, President Ferdinand R. Marcos, JR. of the Philippines issued Executive Order No. 62, which will reduce import tariffs on many items. For rice, the import tariff will be reduced from 35% to 15%, effective until 2028.

Philippines officially decides to reduce rice import tax to 15%

This can be considered the latest move by the Philippine Government to deal with inflation, especially the price of rice which has been continuously increasing in the market since the beginning of the year.

In the first quarter of 2024, the Philippine economy is relatively stable, except for the increase in prices of some essential consumer goods, especially rice, with an increase of about 24.4% in the first quarter of 2024. Rice prices account for about 9% of the Philippines' consumer price index (CPI).

The effective date of Decree No. 62 is 30 days from the date of publication, and for rice import tax, the effective date is 15 days from the date of publication. Thus, the expected date of application of the new rice import tax rate of the Philippines is early August 2024.

According to the Vietnam Trade Office in the Philippines, Vietnam remains the Philippines’ largest rice export partner. From January 1 to May 23, Vietnam exported 1.44 million tons of rice to the Philippines, accounting for 72.9% of the Philippines’ total rice imports.

Thailand ranked second with exports to the Philippines reaching 300,227 tons, followed by Pakistan reaching 144,834 tons, and Myanmar reaching 65,080 tons. The rest were imported from India, China, Japan, Cambodia, Italy and Spain.

In 2023, the Philippines' total rice imports will reach 3.6 million tons, down 5.9% from the record 3.82 million tons in 2022. However, in 2024, the Philippines' total rice imports are expected to reach around 4 million tons.

According to information from some businesses, the Philippine market is quite fond of Vietnamese DT8 and 5451 rice varieties due to their soft texture. Currently, Vietnamese rice dominates the Metro Manila area and the southern provinces because Vietnamese rice is delicious and has reasonable prices. This is an opportunity for Vietnamese rice and paddy exporting businesses in the second half of 2024.

Over the years, Vietnam has always been the largest rice exporting partner, accounting for over 80% of the total rice imported into the Philippine market. There are some opinions that the Philippines' reduction of rice import tax will create more favorable conditions and increase opportunities for Vietnamese rice in the Philippine market.

The latest data provided by the Bureau of Plants (Ministry of Agriculture of the Philippines) shows that from January 1 to May 23, the total volume of rice imported by the Philippines increased by 20.3% compared to the first 5 months of 2023, reaching 1.97 million tons, much higher than the import level of 1.64 million tons in the first 5 months of 2023. Since the beginning of the year, the Bureau of Plants has issued 4,066 rice import clearance licenses to importing enterprises.

Source: https://congthuong.vn/philippines-chinh-thuc-giam-thue-nhap-khau-gao-xuong-con-15-327957.html