Soaring prices push government to mull cutting tariff of milk powder for babies

The China Post news staff

The China Post news staff–In response to a lawmaker’s complaint about the soaring prices of powdered milk for babies, the government may consider reducing the tariff on it as an incentive to ease the burden of child-rearing and raise the country’s declining fertility rate. A Ministry of Finance’s (MOF) Tariff Committee meeting is scheduled for Nov. 14 to discuss whether to continue reducing the tariffs on cane sugar, butter, soybean meal, corn flour and two other imports.

Lawmakers, however, yesterday pushed through a proposal that calls for the inclusion of milk powder on the meeting’s agenda and a temporary reduction of the tariff on its import.

In response, MOF Minister Lee Sush-der (李述德) said the government would carefully consider the proposal and work for a reduction. At present, the country’s tariff rates on baby milk powder and formula milk powder are 5 percent and 12 percent, respectively.

Meanwhile, parents are complaining about the steadily rising prices of the sustenance for babies.

“Two years ago, when I had my first child, a 2-pound can of imported brand milk powder sold for NT$500. But this year, when I had my second child, it became NT$700 a can,” a mother of two told reporters yesterday.

A newborn baby can consume a 2-pound can in 10 days, and parents have to spend around NT$2,000 on a baby’s powdered milk alone each month.

In view of the rising prices of bulk materials, such as butter and soybean meal, on the international market, the MOF has repeatedly reduced tariffs. The ministry’s most recent rate reduction, its June 1 introduction of a temporary tariff rate on cheese, dehydrated cream, corn flour, soybean meal, fine grain cane sugar and refined sugars, is set to expire on Nov. 30. The reduction has varied from 25 to 50 percent.

In the past, MOF also has reduced the tariffs on milk powder for babies, skimmed milk power, full-fat milk powder, and various kinds of formula milk powders. However, only the tariff rates on skimmed milk powder and full-fat milk powder will definitely stay reduced.

Lu Shiow-yen (盧秀燕), a lawmaker from the ruling Kuomintang, yesterday said she had initiated the proposal because the country’s low fertility rate was becoming a major headache. “The tariff rates on both baby milk powder and formula milk powder should be reduced to ease the pressure on child-rearing parents,” she said.