The Bureau of Customs (BOC) said it is ready to start its audit of rice traders next month in line with its probe to determine if there was undervaluation of rice imports.
The Department of Finance (DOF) also announced on Monday that the BOC has collected a total of P6.479 billion in tariffs from rice imported by traders as of July 15 following the implementation of Republic Act (RA) 11203.
“We are preparing the audit notification letters. Yes, we will issue [by the first week of August],” Vincent Maronilla told the BusinessMirror. The BOC official said earlier that the values of the rice shipments declared by traders were “inconsistent.”
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.
The BOC will conduct the audit after the Federation of Free Farmers Inc. said rice imports made after RA 11203 took effect were undervalued. However, in a statement issued on Monday, the BOC denied the allegations of the FFF.
The BOC said its Assessment Operations and Coordinating Group (AOCG) revealed that it is the office of the Import Assessment Service (IAS) that provides Reference Values on rice import as guides when the veracity of the declared values are disputable.
“All Ports abide with the said published data except when the Commercial Invoice of a rice shipment is supported by genuine and validated Proof of Payment such as Bank Telegraphic transfer of Payment, Sales Contract and other similar legitimate instrumentalities that indicated actual sales transaction between the seller and the buyer,” the BOC said.
The bureau said the system it uses is recognized by the World Trade Organization of which the Philippines is a member and is prescribed under the Customs Modernization and Tariff Act (CMTA).
Collection
The BOC reported to Finance Secretary Carlos G. Dominguez III during a recent executive committee meeting that it collected P6.479 billion in duties from traders who imported rice after the law took effect on March 5.
The DOF said the government also collected P3.103 billion in payments from traders for import permits issued by the National Food Authority since January.
Earlier this month, the DOF said the BOC had collected P5.9 billion in 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 P5.9 billion was collected from rice shipments made in January to June.
He said 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 period, 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.
Basing computations on Maronilla’s clarification, tariffs collected from rice imports from July 1 to July 15 amounted to around P600 million.
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 (RCEF), under the new law.
Section 13(c) of the rice tariffication law states that 10 percent of the P10-billion RCEF shall be made available in the form of credit facility with minimal interest rates and with minimum collateral requirements to rice farmers and cooperatives.
The rest of the RCEF will be set aside for farm machinery and equipment; rice seed development, propagation and promotion; and rice extension services, as provided under RA 11203.
On top of paying tariffs, rice importers are required under RA 11203 to secure sanitary and phytosanitary import clearances from the Department of Agriculture’s Bureau of Plant Industry, which assumed the food safety regulation function of the NFA under the rice trade liberalization law.