National Food Authority (3)

December 12, 2013 FIRB RESOLUTION NO. 009-13 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 PhP1,570,800,000.00 to cover the NFA's duty obligation for its regular rice importations of 187,000 metric tons (MT) for 2013, per FIRB Resolution No. 3-13; WHEREAS, the FIRB also approved the amount of PhP55,813,890.00 to cover the NFA's additional duty obligation for its additional importation of 18,700 MT, per FIRB Resolution No. 7-13, thereby, increasing the total volume of rice importation for 2013 from 187,000 MT to 205,700 MT with a corresponding duty of about PhP1,626,613,890.00; SHTEaA WHEREAS, recent natural disasters have resulted in great loss of lives and property as well as substantial damage to infrastructure and agriculture that adversely affected the supply of agricultural crops in the country; WHEREAS, to ensure adequate supply of rice in the country as well as augment the needed buffer stock requirement of the NFA, the NFA Council, per Council Resolution No. 700-2013-K, approved the importation of 500,000 MT of rice on a government to government mode of procurement with targeted arrivals of 300,000 MT in 2013 and 200,000 MT in 2014, the corresponding duty obligations thereon to be covered by the Tax Expenditure Subsidy; WHEREAS, to facilitate the importation, the NFA requested for additional tax subsidy in the amount of PhP4,387,196,000.00 to cover the additional importation of 500,000 MT of rice, PhP2,632,317,600.00 for the 300,000 MT and PhP1,754,878,400.00 for the 200,000 MT, based on an estimated foreign exchange rate of PhP44.00 to US$1; WHEREAS, based on the computation provided by the Corporate Affairs Group of the Department of Finance, the total cost for the importation of 300,000 MT of rice would amount to PhP2,623,642,917.00 only, based on the foreign exchange rate of PhP43.86 to US$1 as indicated in the Bangko Sentral ng Pilipinas (BSP) Exchange Rate Bulletin as of November 25, 2013; WHEREAS, the FIRB can only act upon importations that would arrive in 2013 in view of the tax subsidy provision under the 2013 General Appropriations Act; WHEREAS, payment of its duty obligations would have an adverse impact on NFA's financial position as duties would form part of its operating expenses; ISAcHD NOW, THEREFORE, BE IT RESOLVED, AS IT IS HEREBY RESOLVED, to approve the request for additional tax subsidy of the NFA but only in the amount of TWO BILLION SIX HUNDRED TWENTY THREE MILLION SIX HUNDRED FORTY TWO THOUSAND NINE HUNDRED SEVENTEEN PESOS (PhP2,623,642,917.00) covering the additional importation of 300,000 MT of rice for 2013: Provided, that the NFA shall submit to the FIRB a certified copy of its importation plan containing information on the volume of rice importation per port of discharge and estimated date of arrival: Provided further, that the Certificate of Entitlement to Subsidy (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 importation authorized by the NFA Council for 2013: Provided finally, that such availment shall be in accordance with the terms and conditions of Section 13 of RA No. 10352 or the 2013 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.) LAURA B. PASCUA Undersecretary Department of Budget and Management (SGD.) ADRIAN S. CRISTOBAL, JR. Undersecretary Department of Trade and Industry (SGD.) EMMANUEL F. ESGUERRA Deputy Director-General National Economic and Development Authority (SGD.) ESTELA V. SALES Deputy Commissioner Bureau of Internal Revenue (SGD.) ALEXIS F. MEDINA Director Bureau of Customs (SGD.) TRINIDAD A. RODRIGUEZ Officer-in-Charge National Tax Research Center Head, FIRB Secretariat (SGD.) JEREMIAS N. PAUL, JR. Undersecretary Department of Finance Presiding Officer-FIRB