"The review of about 11,000 tariff lines is almost complete but since Congress is already in session Malacañang cannot yet issue an Executive Order to that effect," Favila said.

"But it (the EO) should be ready by next Congressional break," Favila said. Congress will go on a long recess on April 7 to May 14 yet.

Already, domestic industries are putting pressures on the Tariff and Related Matters (TRM) committee to come up with the new comprehensive MFN tariff program saying they cannot move on with their plans unless government has made up its mind on the tariff levels.

"Local industries are awaiting the result of the TRM deliberations," an industry official said.

The TRM is co-chaired by the Department of Trade and Industry and the National Economic & Development Authority but the DTI chairs the technical TRM.

The last comprehensive tariff reform program (CTRP) in 2003 already expired in December 2005 and so far, there is no indication from the TRM if a new CTRP is now ready for implementation.

The only thing the industries know about is that the technical working group is not yet finished with its study.

The absence of an Executive Order on comprehensive tariff as of end 2005 means that the old tariff rates are still in effect.

But the implication is industries with pending petitions for increases or reduction in tariffs are put in ambivalent situation wherein they cannot really plan for their next moves.

"Plans for our operations are being affected because tariff is an important factor in our operation," a source said.

For instance, if one is an importer he must know the rates as he plans his next move.

Tariff is also crucial to a producer to determine if he could still be competitive because tariff differential is one of basis for the production cost.

Industries that have pending requests for tariff adjustments include steel, appliance and petrochemicals.

In September last year, the Tariff Commission, which hears tariff petition, has recommended to maintain existing tariff rates on 5,000 tariff lines, representing 50 percent of the country’s 10,400 total most favored nation (MFN) tariff lines, while less than 20 percent would be raised and the rest or about a third would be reduced.

TC chair Edgardo Abon said the proposed five-year comprehensive tariff program would be revenue neutral.

Abon said the TC had submitted its recommendations to the CTRM Secretariat after completing the comprehensive tariff review.

The CTRM Secretariat was supposed to table the TC recommendation for TRM Technical deliberations and the TRM Technical will refer it to a working group to undertake a line by line review.

The next process would be an approval by the technical and recommended to the Cabinet TRM afterwhich the President issues an Executive Order.

The TC recommendation was to lay down the tariffs for a longer period of 2006-2010 to provide transparency and flexibility to businessmen and investors.

The tariff levels would be 1-3-5-7-10-15, he said.

In deciding what product rates have to be maintained, reduced or raised, Abon said the TC was guided by the criteria of whether the items are locally-produced, the industry has improved its competitiveness or still need assistance.

Abon, however, explained that if an item is listed for tariff maintenance it does not mean its tariff rate will have to be maintained for the entire five year period.

It could be that tariffs may be maintained only on the first to second years of the comprehensive tariff program but the rates would have to be progressively reduced for the remaining years of the program.

Those items that have to be raised would mean the rates would be raised on the first year but these will be subjected adjusted for the rest of the five-year tariff program.

Those that would be reduced are also expected to see adjustments in the latter part of the five-year tariff program.