National Food Authority (1)

April 7, 2009 FIRB RESOLUTION NO. 004-09 SUBJECT MATTER : National Food Authority (1) WHEREAS, the National Food Authority (NFA) is mandated to ensure food security and grains supply in the country and stabilize their prices; ICAcHE WHEREAS, there is a need to stabilize the price and supply of basic food commodities, particularly rice and corn which are the Filipino staple food items; WHEREAS, to achieve these objectives, the NFA has resorted to rice and corn importations to augment domestic production, in the process incurring duty obligations thereon to the Bureau of Customs (BOC); WHEREAS, the NFA applied for tax subsidy in the amount of P20,662,917,187.50 corresponding to its 2009 rice importations as payment of its duty obligations would have an adverse impact on NFA's financial position and further exacerbate the magnitude of its loss as duties would form part of its operating expenses; WHEREAS, the NFA applied for additional tax subsidy in the amount of P7,945,087,500 corresponding to the additional rice importation for 2009 by the private sector; WHEREAS, the NFA also applied for tax subsidy in the amount of P1,330,732,500.00 corresponding to the private sector's 2009 corn importations; WHEREAS, the provision of tax subsidy to answer for the duty obligations on the rice and corn importation of the private sector is likely to encourage the latter to help address the strong demand and shortfall in overall cereal production versus utilization requirement; WHEREAS, the grant of tax subsidy to the subject rice and corn importation will help the government to immediately stabilize the price of rice and the supply of corn; NOW, THEREFORE, BE IT RESOLVED, AS IT IS HEREBY RESOLVED, to approve the application for tax subsidy of the NFA corresponding to its 2009 rice importations in the amount of TWENTY NINE BILLION NINE HUNDRED THIRTY EIGHT MILLION SEVEN HUNDRED FIFTY SEVEN THOUSAND THREE HUNDRED SEVENTEEN AND 50/100 PESOS (P29,938,757,317.50) only, broken down as follows: Volume Customs Duties (MT) Rice P28,608,005,317.50 NFA 1,500,000 P20,662,917,817.50 Private Sector 400,000 7,945,087,500.00 Corn 1,330,752,000.00 Private Sector 250,000 1,330,752,000.00 Grand Total P29,938,757,317.50 =============== Provided, that the initial issuance of the Certificate of Entitlement to Subsidy (CES) shall be limited to the amount of P1,724,382,906.00 only , representing duties due on twenty (20) shipments of rice (132,500 MT) with BOC billings: Provided further, that the subsequent CES shall be issued only upon submission by the NFA to the FIRB of the required billings and/or documents evidencing the importations with a certification from the NFA that the volume covered by said billings is part of the rice and/or corn importation authorized by the NFA Council for 2009: Provided finally , that such availment shall be in accordance with the terms and conditions of Section 13 of the 2009 General Appropriations Act, subject to the availability of funds therefor, pursuant to the terms and conditions of the Rules and Regulations to Implement the Subsidy Provision under Executive Order No. 93. TCEaDI (SGD.) GIL P. MONTALBO Director Department of Budget and Management signed by representative REYNALDO V. UMALI Deputy Commissioner Bureau of Customs (SGD.) JAMES H. ROLDAN Assistant Commissioner Bureau of Internal Revenue (SGD.) LINA D. ISORENA Executive Director Head, FIRB Secretariat National Tax Research Center (SGD.) ELMER C. HERNANDEZ Undersecretary Department of Trade and Industry (SGD.) MARGARITA R. SONGCO Deputy Director-General National Economic and Development Authority (SGD.) GIL S. BELTRAN Undersecretary of Finance Presiding Officer-FIRB