By Dominique Gabriel G. Bañaga
The Confederation of Sugar Producers Association Inc. (Confed) commends the 11 representatives who have authored a resolution at the House of Representatives, expressing staunch opposition to the proposal of the Department of Finance (DOF) to liberalize sugar importation.
Confed national president, Aurelio Gerardo Valderrama, Jr. conveyed gratitude on behalf of the officers and members of the organization to the lawmakers, 10 of which were representatives from Negros island, who introduced House Resolution (HR) 1199.
The resolution strongly opposes the liberalization of sugar importation due to its adverse effects on the domestic sugar industry.
Valderrama emphasized that the sugar industry requires focused government initiatives that promote increased production, reduced production costs, and favorable import and taxation policies that safeguard local farmers.
He highlighted that liberalizing sugar importation is not the solution the industry needs.
The resolution titled “Expressing the strong opposition of the House of representatives to liberalization of the importation of sugar, in consideration of its negative impact on the domestic sugar industry,” was authored by 11 lawmakers, predominantly hailing from Negros.
In an effort to generate more government revenue, Finance Secretary Benjamin Diokno proposed increasing the tariff on sugar-sweetened beverages (SSBs).
Under the current Tax Reform for Acceleration and Inclusion (TRAIN) Law, SSBs are taxed at a rate of P6 per liter, while beverages sweetened with high-fructose corn syrup (HFCS) are taxed at P12 per liter.
The DOF’s recommendation is to double the existing tariff on SSBs to P12 per liter, aligning it with the tariff on HFCS beverages.
The department also suggests allowing food and SSB manufacturers to directly import their sugar requirements to make the proposal more acceptable.
The authors of HR 1199 reminded that during the crafting of the TRAIN Law, proponents agreed to allocate revenues from the tax on sweetened beverages to programs aimed at boosting domestic sugar production and enhancing the well-being of sugarcane farmers and farm workers.
Despite this, HR 1199 pointed out that only P3.92 billion had been allocated for the “Sugarcane Industry Development Act (SIDA)” programs between 2018 and 2023, while revenues from the TRAIN Law for the same period amounted to P336.1 billion, with 52 percent originating from taxes on sweetened beverages.
The resolution underscores that the domestic sugar industry has been neglected in terms of essential government support.
Instead of addressing the issue, the DOF’s proposal to liberalize sugar importation further exacerbates the challenges facing the industry, as noted by the lawmakers.
Diokno’s proposal, involving an increased tax rate on SSBs and the liberalization of sugar importation, may purportedly offer a solution, but they assert that it will disproportionately harm the poor, sugarcane farmers and farm workers.
In support of their stance, the Negrense lawmakers referenced a 2021 study commissioned by the National Economic and Development Authority, which cautioned that sugar trade liberalization would primarily benefit the affluent and come at a clear cost to the stakeholders of the sugar industry./DGB, WDJ