Aquino, Purisima face graft plaint over gasoline smuggling

A former customs commissioner on Wednesday filed a graft complaint against former President Benigno Aquino III and his Finance Secretary Cesar Purisima for turning a blind eye on the alleged smuggling of gasoline.

In a joint complaint-affidavit filed before the Office of the Ombudsman, former Bureau of Customs Commissioner Napoleon Morales named Pilipinas Shell Petroleum Corporation (PSPC) as misdeclaring its gas importations since 2004 after it reclassified the gasoline as imports that are not subject to taxes.

“Without any iota of doubt, PSPC’s misdeclarations and refusal to pay the proper excise tax and VAT constitute smuggling penalized under the Tariff and Customs Code of the Philippines,” the complaint read.

Other complainants include Lourdes Aclan, a journalist and publisher of Headlines News Today, and Juan Tan, a former district collector at the Port of Batangas.

The complainants said from 2001 to Feb. 2004, PSPC paid excise tax and value added tax (VAT) for its gas importation which it declared as Catalytic Cracked Gasoline (CCG) and Light Catalytic Cracked Gasoline (LCGG). These imports were classified as unleaded gasoline.

In March 2004, PSPC suddenly changed the declaration of tariff classification from unleaded gasoline to “tetrapropylene,” which is not subject to excise tax and VAT. The PSPC also reclassified the import to mere “blending component.”

“Due to this modification in the declaration, PSPC evaded payment of the taxes for all its shipments of CCG and LCCG from March 2004 to 2009,” the complainants said.

In 2009, Tan as customs district collector discovered PSPC’s misdeclaration and misclassification of gasoline importations. This compelled Tan to demand from PSPC the payment of P7.348 billion for the unpaid excise tax and VAT from 2004 to 2009.

With the misdeclaration discovered by the customs, complainants said PSPC then changed its declaration to alkylate for blending component and from tetrapropylene to “waste oil,” which are again not subject to tax. The misdeclaration of imports to alkylate cost the government some P1.99 billion in losses at the time.

This misdeclaration of tax was again discovered by Tan, who reported it to then Customs Commissioner Angelito Alvarez and Purisima in April 2011.

But Alvarez did not take action until he was replaced by then Customs Commissioner Ruffy Biazon.

In Nov. 2011, Aclan then wrote to Purisima about the refusal of Biazon to demand payment from PSPC for the alkylate shipment.

Aclan also wrote to erstwhile President Aquino in July 2012 complaining about the refusal of Purisima and Biazon to collect payment from PSPC.

The complainant said Aquino and Purisima were informed of the irregularities but failed to act on the controversy even after the end of the previous administration.

“However even with his authority and power to order Secretary Purisima, Comm. Biazon and Collector Benavidez to act on the matter and demand the payment from PSPC, President Aquino ignored complainant Aclan’s letter with indifference, as the PSPC controversy was left unanswered until he stepped down from office on June 30, 2016,” the complainants said.

“Due to PSPC’s misdeclaration of shipments that evaded payments of the taxes, and the refusal of Sec. Purisima, Comm. Biazon and Coll. Benavidez to demand the payment of excise tax and VAT from PSPC and the indifference of President Aquino on the issue, the government is deprived, as it is continuously being deprived, of the huge amount of money, which would have been collected had they not been remiss in the performance of their official functions,” the complainants added.

All in all, the government lost over P100 billion (inclusive of interest, surcharge and 800 percent penalty), the complainants said.

Since July 2014, the monthly unleaded gasoline shipments misdeclared as alkylate were being released by the Customs free of P55 million in monthly taxes, the complainants said.

The government is losing P55 million monthly accumulating to P1.3 billion as of July 2016, in addition to the still unpaid P1.99 billion taxes on Alkylate imports, as well as the still unpaid P7.348 billion taxes on CCG and LCCG imports.

The complainants said PSPC was spared from paying taxes while other oil companies Chevron and Seaoil were diligent in paying excise taxes and VAT on gas imports.

The complainants said Aquino and Purisima did nothing but allow the PSPC to use the P7.348 billion and P1.99 billion for its own use instead of generating revenue for government.

Complainants alleged that Aquino and Purisima’s failure to act on the alleged smuggling caused undue injury to government and gave unwarranted benefits to PSPC, making them liable for graft or violation of Section 3(e) of the Anti-Graft and Corrupt Practices Act.

The complainants also said Aquino and Purisima should be charged for violating the Tariff and Customs Code for illegal importation, and Republic Act 9851 in relation to Executive Order 226 entitled “Institutionalization of the Doctrine of Command Responsibility.”

The complainants cited Executive Order 226 which holds a government official liable for neglect of duty under command responsibility for failing to exercise control over subordinates even though the superior was well aware of the crimes committed at the time.

“Former President Aquino may be held criminally liable under Section 10 of Republic Act 9851, in relation to EO 226, under the concept of command responsibility, he being the superior exercising direct control and supervision over government officials,” the complainants said.

The complainants said the following PSPC officials should be held liable for violating the Traffic and Customs Code for smuggling: PSPC Chairman and President Edgar Chua, Vice President for Communications Robert Kanapi and Country Tax Manager Nigel Avila.

The complainants said the government officials refused to demand payment from PSPC because they were silenced into submission by a big corporation like Shell.

“The deafening silence of the respondents in their refusal to apply the laws to effect the collection, including the indifference on the smuggling activities of PSPC, create an inexcusable conclusion that they were silenced into submission by the giant corporation,” the complainants said. RAM

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