Confed lauds solons for opposing sugar import liberalization

The Confederation of Sugar Producers Associations (CONFED) lauded the eleven solons who authored the House of Representatives resolution expressing strong opposition to the Department of Finance’s proposal to liberalize sugar importation because of its negative impact on the sugar industry.

“The officers and members of Confed thank the eleven representatives who filed House Resolution No. 1199 for taking up the cudgels for the sugar industry. While we recognize government’s need to raise more revenues, it should not be done in a way that will be disadvantageous to sugar producers,” said Aurelio Gerardo “Bodie” J. Valderrama, Jr., Confed national president.

“Liberalization of sugar importation is not what the sugar industry needs. What sugar producers need is more government programs to boost our production and lower our production costs, and more conducive import and taxation policies which supports and protects our farmers,” Valderrama further said.

HR No. 1199, “expressing the strong opposition of the House of Representatives to liberalization of importation of sugar, in consideration of its negative impact on the domestic sugar industry,” is authored by eleven solons, ten of whom are from Negros.

They are Negros Occ. Reps. Jose Francisco B. Benitez (3rd District), Joseph Stephen S. Paduano (Abang Lingkod), Greg G. Gasataya (Bacolod City), Gerardo P. Valmayor Jr. (1st District), Alfredo D. Marañon III (2nd District), Juliet Marie De Leon Ferrer (4th District), Emilio Bernardino L. Yulo (5th District) and Mercedes K. Alvarez (6th District); Negros Oriental Reps. Jocelyn Sy Limkaichong (1st District) and Manuel T. Sagarbarria (2nd District); and Rep. Michael B. Gorriceta (Iloilo-2nd District).

As part of efforts to raise more government revenues, Finance Sec. Benjamin Diokno has proposed to increase the tariff on sugar sweetened beverages (SSBs).

Currently, under RA No. 10963 or “Tax Reform for Acceleration and Inclusion (TRAIN) Law”, a tax rate of P6/liter is assessed on SSBs, while beverages sweetened with high fructose corn syrup (HFCS) are assessed P12/liter.

The Finance Department reportedly recommends increasing the tariff on SSBs to P12/liter, making it double the existing rate and equal to the tariff on beverages using HFCS. To make the proposal acceptable to food and SSB manufacturers using sugar, the DoF further recommends allowing them to directly import their sugar requirement.

The authors of HR No. 1199 recalls that, when the TRAIN Law was being crafted, its proponents “agreed to plough back revenues from the collection of tax on sweetened beverages to programs aimed at increasing domestic sugar production and promoting the welfare of sugarcane farmers and farmworkers”.

Further, they cited that, for the first five years of the TRAIN Law’s effectivity, 30% of TRAIN revenues should be used to finance social welfare programs, including the P2 billion annual allocation for the sugar industry under RA No. 10659, otherwise known as “Sugarcane Industry Development Act (SIDA)”.

HR No. 1199 pointed out that only P3.92 billion had been allocated in 2018-2023 for SIDA programs, although revenues from the TRAIN Law for the same period reached P336.1 billion, 52% percent of which came from taxes on sweetened beverages.

“The domestic sugar industry has been starved of the much-needed government support” but, “instead of remedying this injustice, the DOF proposes to liberalize sugar importation that will further compound the ills of the domestic sugar industry,” the solons emphasized.

Sec. Diokno’s proposal, increasing the tax rate of SSBs and cushioning its impact by liberalizing sugar importation, claims “to provide a solution, but will harm the poor, and sugarcane farmers and farmworkers”, according to the solons.

They further cited a study, commissioned by the National Economic and Development Authority in 2021, which cautioned that sugar trade liberalization “would favor the rich more than the poor” and will be “at a clear cost to the sugar industry stakeholders”.*