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14 June 2024, 01:44 AM

High Revenue Ceiling Stumps Customs; “But Full Year Goal Still Within Reach,” — Alvarez

April 8, 2010

The Bureau of Customs did not meet its September cash collection goal of P23.358 B but the agency is surprisingly on target to surpass last year’s total cash collection of P198.2 B as early as mid-November this year.

Citing preliminary figures, Customs Commissioner Angelito Alvarez said the BOC’s September cash collections totaled P19.652 B, some P3.706 B short of what was programmed but “P2.027 B more than the agency’s total cash collection during the same period last year.”

“In fact,” added Alvarez, “the BOC, on a month-to-month basis, has consistently surpassed last year’s cash collection performance by an average of P2.8 billion. As a result, the agency’s total cash take for the period January to September this year surpassed by more than P25 billion what it earned from duties and taxes during the same period last year.”

The BOC needed only to make P30 billion more to break last year’s cash collection of P198 billion, an amount that Alvarez said would likely be in the bag before the second half of November as the bulk of imports for the Christmas holidays had started to come in.

The customs chief cited two major reasons for the agency’s failure to meet its cash collection target of P23.358 billion for the month of September: a) the heavy utilization of oil industry players of the tax credit instrument; and, b) the impact of zero tariff on imported oil and motor vehicles from Japan.

He said the foregone cash income from these two revenue-draining measures proved too much of a handicap for the ports of Limay and Batangas where the bulk of said commodities are traditionally unloaded.

Alvarez said total revenues generated in the Port of Limay was P1.386 B short of the P2.895 B target while that in Batangas was P1.174 B less than the P5.323 B that was programmed for the month of September.

Taken together, the two ports accounted for more than 70 % of the agency’s September collection shortfall of P3.7 billion.

Alvarez also cited the prevailing zero tariff on wheat, cement and steel and the reduced, if not zero, duties being enjoyed by dozens of other products in compliance with the country’s various international, multi-lateral and bilateral agreements (such as AFTA and JPEPA) as another major contributory factor to the lower-than-programmed collection.

“Still,” said Alvarez, “the amount of P170.3 B that the BOC collected for the period January to September was only P1.9 B less than the programmed cash collection of P172.2 B. This has given rise to optimism that we can still hit the full-year cash collection target of P241 billion given the fact that aside from the heavy influx of imports expected in the run up to Christmas holidays, we have other non-traditional sources of revenues to fall back on, among them the sale of confiscated and abandoned goods and proceeds from the accomplishments of our Post-Entry Audit Group (PEAG).

Alvarez said he had always focused on the agency’s cash collection performance because the inclusion of the TEF in the total collection target was not a good gauge of collection efficiency because the TEF was only ‘revenue in paper’ and that nothing the BOC does or does not do can affect it.”

The pressure on the BOC, said Alvarez, was made more intense by the fact that for this year, the cash collection target imposed on the BOC for this year (241.6 billion) was P43.5 billion more than what the agency actually earned last year.(198.1 billion).

Republic of the Philippines

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