National Food Authority (3)

May 18, 2010 FIRB RESOLUTION NO. 006-10 SUBJECT MATTER : National Food Authority (3) WHEREAS, the National Food Authority (NFA) is mandated to ensure food security and grains supply in the country and stabilize their prices; WHEREAS, there is a need to stabilize the price and supply of basic food commodities, particularly rice which is the Filipino staple food; WHEREAS, to achieve these objectives, the NFA has resorted to rice importations to augment domestic production, in the process incurring duty obligations thereon to the Bureau of Customs (BOC); WHEREAS, the FIRB already approved the amount of P28,821,705,291.80 and P1,636,309,339.69 to cover the NFA's duty obligation for its 2010 regular rice importations and sugar importations for the private sector per FIRB Resolution Nos. 3-10 and 4-10, respectively; WHEREAS, the NFA applied for additional tax subsidy in the amount of P2,136,274,800.00 corresponding to its additional importation of 200,000 MT of rice for 2010 for the private sector; WHEREAS, the NFA also requested for tax subsidy for unsettled duties due on its two (2) shipments of rice importations for the year 2009 in the amount of P9,060,027.00 since the corresponding billings for these shipments were received only by the NFA on February 2010, thus, were not included in its request for a Certificate of Entitlement to Subsidy (CES) for the year 2009; WHEREAS, the NFA additionally applied for tax subsidy in the amount of P213,627,400.00 to cover the duties on its additional importation of 20,000 MT of rice for the private sector under the Private Sector Financed Rice Importation to be allocated to the Philippine International Trading Corporation; cDAEIH WHEREAS, the provision of tax subsidy to answer for the duty obligations on the additional rice importation of the private sector is likely to encourage the latter to help address and stabilize the supply and prices of rice; WHEREAS, 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; NOW, THEREFORE, BE IT RESOLVED, AS IT IS HEREBY RESOLVED, to approve the application for tax subsidy of the NFA in the amount of TWO BILLION THREE HUNDRED FIFTY EIGHT MILLION NINE HUNDRED SIXTY TWO THOUSAND TWO HUNDRED TWENTY SEVEN PESOS (P2,358,962,227.00) only, broken down as follows: P2,136,274,800.00 corresponding to its 2010 additional importation of 200,000 MT of rice for the private sector; P9,060,027.00 representing the duties due on NFA's two (2) shipments of rice (1,000 MT) which were part of its 2009 regular rice importations; and P213,627,400.00 corresponding to its additional importation of 20,000 MT of rice to be allocated to the PITC: Provided, that the initial issuance of CES shall be limited to the amount of P9,060,027.00 only, representing duties due on two (2) shipments of rice in 2009 with billings from the BOC; 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, together with a certification that the volume covered by said billings is part of the rice importations for the private sector earlier authorized by the NFA Council for 2010: Provided finally, that such availment shall be in accordance with the terms and conditions of Section 14 of the 2010 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. (SGD.) EDNA V. BARRIDA Director Bureau of Customs (SGD.) ELMER C. HERNANDEZ Undersecretary Department of Trade and Industry (SGD.) MARGARITA R. SONGCO Deputy Director-General National Economic and Development Authority (SGD.) MARISSA O. CABREROS Assistant Commissioner Bureau of Internal Revenue (SGD.) DANTE V. SY Executive Director National Tax Research Center Head, FIRB Secretariat Director Department of Budget and Management (SGD.) GIL S. BELTRAN Undersecretary of Finance Presiding Officer-FIRB