Home » Customs & Trade » Customs eyes higher import tariff to offset foreign exchange losses

THE Bureau of Customs (BOC) is proposing to increase the tariff on imported products to 5% to help the bureau plug collection loopholes estimated at around P15 billion as of end October. The measure will also put the agency on track to meet its 2008 mandated collection target of P254 billion.

The BOC has been hard pressed in meeting its 2007 collection target amid the strong peso and low cargo volume.

Customs commissioner Napoleon Morales said the bureau loses P2 billion in revenues for every P1 appreciation of the peso.

“We are trying our very best but things get harder and harder everyday for us at the bureau as the peso continues to grow stronger. This aspect is very vital because the first step in tax collection is converting the invoice value (in dollar) to peso,” Morales explained.

“Our collection last year from January to October, based on a P52 to a dollar foreign exchange rate, was P164.695 billion. This year, based on a rate of exchange of approximately P45 to $1, we managed to collect P171.897 billion, P7.202 billion above our 2006 output,” he said.

This year’s 10-month collection was, however, P15 billion short of the bureau’s target.

Despite the deficit, Morales remains optimistic the BOC will hit its goal due to greater efficiencies in collection as well as the expected cargo influx in the runup to Christmas.

“The remedial… and alternative measures we have set in place are working in spite of the odds,” he said.

Aside from the proposed increase in import tariff, the BOC is also intensifying its post-entry audit program involving oil, motorized vehicles and vessels in a bid to meet its targets.

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