THE Bureau of Customs (BOC) is now implementing the 5-percent tariff rate on mechanically deboned meat (MDM) of chicken and turkey after President Duterte issued an executive order (EO) retaining the lower tariff rate on MDM.
The BOC issued Customs Memorandum Circular (CMC) 144-2019, which called for the collection of a 5-percent tariff on MDM, pursuant to EO 82 signed by the President on June 13.
A separate memo was issued by the BOC’s Management Information System and Technology Group (MISTG), which instructed the bureau’s employees and district subport collectors to collect a tariff rate of only 5 percent on MDM.
“In accordance with CMC 144-2019 dated June 18, 2019, please be informed that this office [MISTG] has implemented the modified nomenclature and rate of import duty in the E2M system pursuant to the executive order effective June 19, 2019,” BOC Deputy Commissioner Allan C. Geronimo said in the memo.
The E2M (electronic-to-mobile) system was rolled out by the BOC in 2008 to streamline imports and exports processing.
BOC Public Information and Assistance Division chief Administrative Officer Elenita Abaño told the BusinessMirror via SMS that the lower tariff rate on MDM has already been encoded in the bureau’s system. It was supposed to take effect on June 19.
With this, the BOC will no longer collect a 40-percent tariff on chicken MDM. The BOC had issued a memorandum dated May 23, which authorized the collection of a 40-percent tariff on MDM.
The bureau argued that the reversion of MDM tariff to 40 percent was in accordance with the law. It cited in particular EO 23 issued by the President in 2017, which stipulated that concessionary rates on certain agricultural products should go back to the 2012 levels once the quantitative restriction (QR) on rice is removed.
The QR on rice was removed and converted into ordinary customs duties once Republic Act (RA) 11203 took effect on March 5. The Department of Agriculture had argued that the reversion of MDM tariff to 40 percent is automatic by virtue of EO 23, but meat processors, led by the Philippine Association of Meat Processors Inc. (Pampi), disagreed with this.
The BOC also told the BusinessMirror that traders whose shipments were slapped a lower tariff rate after the effectivity of RA 11203 will have to pay the government the 35-percent tariff difference.
The President’s issuance of EO 82 repeals the BOC’s memorandum circular, which temporarily reverted the tariff on chicken MDM to 40 percent.
EO 82, signed on June 13 and released to the media on June 17, also retained the lower tariff rate on frozen turkey meat and turkey offal at 20 percent. Provisions of EO 82 are applicable until December 31, 2020.
Some BOC workers reported that they continue to encounter the 40-percent tariff rate on MDM despite the issuance of EO 82. The BOC said, however, that this was only because of an error in the system of value- added service providers (VASPs), which are from private entities.
“BOC-MISTG has already adjusted the rate back to 5 percent. However, the VASPs show 40 percent upon lodgement. This can be easily remedied and adjusted once the entry/goods declaration has been filed. Thus, as far as BOC is concerned, it’s [the 5-percent tariff rate] already implemented,” said BOC Spokesman Erastus Sandino B. Austria.
The bureau had also issued Customs Memorandum Order (CMO) 30-2019, which was signed by BOC Commissioner Rey Leonardo B. Guerrero on June 18. The memo contained an official list of fees and charges being collected by the BOC.
“Due to the issue of unjust fees being charged by unscrupulous individuals allegedly in favor of BOC, all customs officials and employees entrusted with the collection of taxes, fees and other imports are enjoined to strictly comply with the said order,” the BOC said.