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TWO
Senate committees are looking to craft remedial
legislation aimed at making sure that tax-holiday
incentives offered to investors are not misused in
alleged technical smuggling activities by conniving
customs officers and wily car importers to dodge
billions of pesos in taxes that should have gone to
government coffers.
“We will
see, we will find out whether the amount of jobs and the
added value to the economy generated by the people given
incentives is commensurate to the tax that we have given
up because of the incentives,” Sen. Juan Ponce Enrile,
finance committee chairman, told reporters following a
public hearing on smuggling issues conducted by the ways
and means committee chaired by Sen. Francis Escudero.
Enrile
echoed suspicions that the switch in government policy
from the progressive car-manufacturing program to the
new motor-vehicle development program could be one of
the sources of the tax leakage taking advantage of the
government incentives originally intended to create jobs
for local folks.
“We
heard there is no more progressive car manufacturing.
They’ve reportedly changed it into motor-vehicle
development program. That’s why I’m asking: Why are they
allowing entry of completely built cars, if we have car
manufacturing here? We have assembly plants. So we have
to produce cars here that are sold in our country
because it generates employment to our people, that’s
why we are giving incentives to them. We are reducing
their taxes in exchange for the jobs they generate for
our people,” said.
But
Enrile explained that this did not materialize. “But
what is happening is, that’s not what we understand is
going on. They allow the entry of completely built cars,
which did not generate jobs for our people or use of
local content, and they don’t benefit from the
incentives given by the government,” he said.
Escudero
agreed with Enrile that the tax leak could also be
traced to a memorandum of agreement between the Bureau
of Customs (BOC) and the Chamber of Automotive
Manufacturers of the Phils. Inc. which allows Campi to
register several imported cars using only one
certificate of payment (CP) of customs duties.
“There
is the potential in the issuance of one CP to cover many
cars. There is the potential leak when LTO [Land
Transportation Office] receives inventory which is not
prepared by a government official who has
accountability, but only by an individual from the
private sector with no liability in case there is an
error in the inventory he submits,” Escudero explained.
During
the hearing, Sen. Richard Gordon confirmed the lucrative
smuggling schemes taking place at the Subic Bay
metropolitan area, involving not just cars, but also
liquor, cigarettes and even illegal drugs, as
authorities uncovered recently.
Gordon
revealed that he obtained reliable information that the
so-called for the boys fund, amounting to at least
P25,000 each, goes to officers of the Subic Bay
Metropolitan Authority, the BOC and the LTO for every
imported car smuggled out of the Subic Freeport.
“I have
the documentation, I can prove this,” Gordon said,
adding that the tax leaks were estimated at P4 billion
for smuggled liquor; P13 billion for cars; and P9
billion for cigarettes. “What are the customs
authorities doing to plug these tax leaks that allowed
the continued flow of smuggled goods into the country
without paying the right taxes?” |
