THE Bureau of Customs (BOC) said on Thursday that it will look into rice imports that arrived in the country from January to June, to determine if the shipments were undervalued.
BOC Assistant Commissioner for the Post Clearance Audit Group Vincent Philip C. Maronilla told the BusinessMirror in an interview that the values declared by traders were inconsistent.
Maronilla made the announcement after the BusinessMirror reported on July 9 (See,“Undervalued rice imports may have caused P5-billion gap in tariff collection,” Banking and Finance page) that the Federation of Free Farmers Inc. suspected the undervaluation of rice shipments by importers and traders.
“In terms of volume, [the shipments] look consistent [with the trend]. But in terms of value, we’ll have to admit, when we looked at the initial evaluation for the first half of the year, the values were inconsistent,” Maronilla said.
“And there were a lot who did not declare their transaction value, that is on a par with our reference, which is based on established and reputable publications on prices,” he added.
Maronilla said he may recommend to the BOC
commissioner the
issuance of audit notification letters to traders and firms. The audit will be
conducted by his office.
“If ever there was undervaluation of shipments, [the BOC] can recover the deficient duties and taxes plus, of course, the corresponding penalties and interests. It’s an instruction actually coming from the [BOC] commissioner to look into it and recommend if it’s warranted,” he added.
Maronilla said the audit notification letters may be sent out by the first week of August, after the bureau has collated and verified the data it collected.
He said the BOC has the power to collect duties and taxes if there were deficiencies in the assessment made on imported rice shipments. He noted that shipments are open for post-clearance audit for up to three years.
“If there is deficiency, the penalty is 125 percent plus 20-percent legal interest per annum to a high of 600 percent if fraud is attendant,” Maronilla said.
The Department of Finance (DOF) reported earlier that the BOC had collected P5.9 billion from tariffs slapped on 1.43 million metric tons (MMT) of rice imported by local traders from March 5 to June 30.
Maronilla clarified, however, that the tariffs were collected from shipments made in January to June. He added that the BOC’s report to the DOF was on the bureau’s performance for the first half of the year and not just for the March to June, when the new law was already in effect.
“[The collections] from March 5 to June, when the rice tariffication law is already in effect, were for 966,690 metric tons,” he said. Tariffs assessed on 966,690 MT of rice reached around P4 billion to P4.5 billion, according to Maronilla.
The BOC official also expressed confidence that the bureau’s collection of rice tariffs will surpass P10 billion, the amount that should be allocated annually to the Rice Competitiveness Enhancement Fund ever year, under the new law.
FFF National Manager Raul Q. Montemayor said the tariffs collected by the BOC from 1.43 MMT of rice imported by traders were “quite small.”
According to FFF’s computation, the landed cost of the rice imports per metric ton would only be about $227 if one were to base this on the import and tariff collection figures released by the BOC, Montemayor said.
Image credits: Roy Domingo