Rep. Alfredo Abelardo “Albee” Benitez (Neg. Occ., 3rd District) yesterday said is filing a bill in the House of Representatives today that will require that the 15 percent Value Added Tax on sugar be used to finance a Sugarcane Development Fund to hasten the diversification of the sugarcane industry.
The bill aims to raise the value of sugarcane by helping sugar mills produce not only sugar, but fuel, power, alcohol and other by-products, to enable the industry to survive trade liberalization beyond 2015, Benitez said.
The bill is in a very general stage but there is enough room for suggestions and refinement, it will get more detailed as it goes through committee hearings in the House, he said.
Filing the bill is the first step towards a Sugarcane Act, he said.
The solon had initially proposed a Sugar Act to cushion the impact of the reduction of tariff on imported sugar with trade liberalization, and had sought inputs from the sugar industry.
Under the ASEAN Free Trade Area agreement tariff on imported sugar entering the country dropped from 38 percent last year to 28 percent this year. It will further drop to 18 percent in 2013, 10 percent in 2014 and 5 percent in 2015.
Concern has been raised that the entry of cheaper highly-subsidized imported sugar into the country when tariffs drop will kill the domestic sugar industry, which produces sugar at higher costs.
Benitez said under the Sugarcane Act they aim to give sugarcane a higher value instead of just relying on sugar for the industry to survive.
“Taking steps to earn more from ones sugarcane is founded on sound economic principles… and frees the industry from having to rely on the protective environment of high tariffs to protect it from outside forces,” Benitez has said.*CPG
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