Customs take declining, says DOF exec

INQUIRER FILE PHOTO

MANILA, Philippines–The head of the Department of Finance’s (DOF) Revenue Operations and Legal Affairs Group has disputed the Bureau of Customs’ (BOC) claim of increased revenue collections in the first five months of the year.

In a confidential memo, Finance Undersecretary Carlo Carag told Finance Secretary Cesar Purisima there had been a decline in the collections of the BOC, a finance department-attached agency.

In the July 1 memo, a copy of which was obtained by the Inquirer, Carag disclosed the negative development, “considering all the growth factors (tariff and foreign exchange rates and import values) versus the actual percentage growth for January to May 2014 compared to the same period in 2013.”

“Notwithstanding the reported increase in the average tariff rate, foreign exchange and value considered as the growth factors during the period, the growth in the bureau’s collection effort has been on a steady decline since January, with a negative growth of -14.38 percent declining further to -16 percent in May,” he said.

He also referred to data from the Statistics Division of the BOC that showed the agency was still behind in its collection target for January to May 2014 by at least 12 percent despite the double-digit increase in its 2014 collection vis-a-vis that in 2013. The greatest shortfall was incurred in May at negative -18 percent.

Citing a recent news report, Carag noted that “imports in the first quarter of 2014 grew by 24.7 percent in January, 1.7 percent in February and 9.6 percent in March, with total imports during the first quarter of 2014 amounting to $16.16 billion, a 12-percent increase from the $14.43-billion recorded during the comparable period last year.”

“Noticeable from the data obtained from the Statistical Division of the bureau is the 36.3-percent increase in the volume of imports classified as nondutifiable for January to March 2014 compared to the same period in 2013 while the volume of imports assessed as dutifiable or taxable decreased by 4.5 percent,” he said.

Discrepancy

“Further study or analysis should be conducted on this data to determine the glaring discrepancy in the volume of dutifiable imports vis-a-vis nondutifiable imports,” Carag said.

In the same memo, he pointed out that news reports in at least four newspapers in the past months “debunk the announcements and press releases on the BOC’s increased collection performance from January to May 2014.”

Two of the reports, titled “Customs revenue growth slows sharply” and “Customs take up but still short of target,” came out in the Inquirer.

Last Wednesday, this paper reported that for the sixth consecutive month this year, the BOC had failed to meet its revenue target with June collections of only P26.96 billion.

Last month’s revenues brought to P173.03 billion the agency’s total collections for the January to June period, nearly P26 billion less than the BOC’s P198.94-billion target for the six-month period, according to a report by the DOF’s bureau of the treasury.