THE government is expected to raise the tariff on some imported steel products soon to 7 percent from the current 3 percent as a support to the operation of the Indian-owned Global Steel Philippines Inc. (GSPI).

This is after the technical committee of the Tariff and Related Matters (TRM) ruled over the weekend that the GSPI is now indeed in commercial operations and is, therefore, entitled to tariff protection as mandated by Executive Order (EO) 375.

Trade Senior Undersecretary Thomas G. Aquino, who chairs the TRM technical committee, said the panel found “justifiable reasons” to declare GSPI in commercial operation based on the conditions set by EO 375.

The EO states that for GSPI to be considered as being commercial operation for the purpose of the grant of tariff reprieve, the company must meet any of these two criteria:

§          The company’s production has reached at least half of its annual registered capacity with the Board of Investments (BOI).

§          Company’s output is already at least 50 percent of the average yearly importation of (hot rolled coils) HRC and CRC (cold rolled coils) for the last five years.

“There is basis for the grant of commercial operation. It puts the company in the proper footing in as far as the EO is concerned,” Aquino said.

A ranking trade official said GSPI was able to prove to the TRM that its output is now above 50 percent of the country’s average yearly importation both for HRC and CRC over the last five years.

What is now required before the Bureau of Customs (BOC) starts imposing 7 percent tariff on HRC and CRC is the confirmation of the Cabinet-level TRM of the technical committee’s report of positive recommendation for GSPI.

“The Customs will be informed upon the determination of the Cabinet TRM in its next meeting,” the source said.

The Cabinet-level TRM (CTRM) is composed of the heads of concerned agencies like the Department of Trade and Industry, National Economic and Development Authority, Department of Finance and Tariff Commission.

EO 375, the official said, states that new tariff will be operational upon the determination of the CTRM.

GSPI waited for over two years before it managed to get the nod of the technical TRM committee as EO 375 has been standing since 2004.

GSPI took over the Iligan plant of the former National Steel Corp. in early 2004.

Local producers of finished steel products are opposing the grant of tariff protection to GSPI as they fear that the company might not be able to meet the domestic requirement.

Aquino said technical TRM committee’s work is merely recommendatory and its recommendations should not be perceived as carried already by the CTRM.

THE government is expected to raise the tariff on some imported steel products soon to 7 percent from the current 3 percent as a support to the operation of the Indian-owned Global Steel Philippines Inc. (GSPI).

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