Home » Customs & Trade, Exclusives, Ports/Terminals » BOC eyes 200 more firms for audit this year

At the customs audit seminar Q&A were Bureau of Customs assistant Commissioner Atty Vincent Philip Maronilla (left), head of the Bureau of Customs Post Clearance Audit Group, and tax consultant Atty Emer Aceron.

The Bureau of Customs (BOC) is looking to audit 200 companies under its second round of post-clearance audits starting August, according to assistant commissioner and Post Clearance Audit Group (PCAG) head Atty. Vincent Philip Maronilla.

The companies are mostly importers of goods imposed with higher excise taxes under the Tax Reform for Acceleration and Inclusion Law, such as tobacco firms; locators of Freeport zones; and traders reported to have suspicious operations, Maronilla told PortCalls in an interview on the sidelines of a recent forum on customs audit organized by PortCalls and Asia Customs & Trade in Subic Bay.

The new batch, and last one for this year, follows the 187 companies under the first group that were issued Audit Notification Letters (ANL) by PCAG last February, and whose audit period expires this month.

The post-clearance audit function, formerly called post-entry audit, was returned to BOC in 2016 after it was transferred to the Department of Finance (DOF) in 2014.

Customs Administrative Order (CAO) No. 01-2019, issued last January, implements the post-clearance audit function and Prior Disclosure Program (PDP) of BOC, pursuant to the Customs Modernization and Tariff Act (CMTA).

Under CAO 01-2019, within three years from the date of final payment of duties and taxes or from customs clearance, as the case may be, BOC may conduct an audit examination, inspect, verify, and investigate records pertaining to any goods declaration, including statements, declarations, documents, and electronically generated or machine-readable data.

Such audit is intended to ascertain correctness of goods valuation and determine the possible liability of the importer for duties, taxes, and other charges, including any fine or penalty.

With many of the 187 companies issued ANLs availing of the PDP, Maronilla said PCAG has already collected around P1.2 billion in voluntary payments since audits began last February.

The collection, which excludes 20% interest and which may still go up when PCAG finalizes its audit findings, is already higher than the P950 million collected by the previous Post-Entry Audit Group in 2007.

“I think we’re set for a record-breaking year for post-clearance audit. We’ve already broken the record for the most collected (by the predecessor unit) but the goal is to quadruple (revenues). My goal is to collect at least P4 billion for this year,” Maronilla said, adding the target is attainable with the current pace in collection.

Asked if many companies under the first audit batch need to pay penalties, Maronilla said yes, but that “surprisingly, there are a lot also who were compliant.”

He emphasized that PCAG will not just punish the non-compliant, “but we will be rewarding as well with certificates of recognition those we’ve audited that were found to be compliant.”

He said most compliant companies in the first batch were big firms, not unusual since they “exercise diligence measures.”

Maronilla said the aim is to audit even more companies in the future, targeting 10% of BOC’s total number of accredited importers.

“But I also don’t want to exhaust our limited personnel to the point that efficiency would suffer,” he said.

PCAG only has 28 auditors but is hiring more now that the election ban has been lifted. The unit expects to increase its personnel to 68 by August, in time for the next batch of audits. Hiring will continue until the entire workforce reaches about 150 auditors. The target is to audit 500 companies in 2020 and 1,000 in 2021.

The PCAG chief advised companies to be “audit-prepared. Do your internal audit and arrange your documents in such a way that when you actually see the Audit Notification Letter, you are ready to present (necessary documents) to the Bureau of Customs.” – Roumina Pablo

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