The Philippine Bureau of Customs (BOC) has amended some guidelines in the imposition of surcharges for misclassification, undervaluation or misdeclaration of customs duties under the Tariff and Customs Code of the Philippines (TCCP).
Customs Administrative Order No. 06-2014 dated October 23 repeals Sections 2 to 3 of CAO 01-2014, or the guidelines for imposing surcharges under Section 2503 of the TCCP.
Under the new guidelines, which take effect on November 7, for misclarifications in which the percentage of difference is more than 10% but does not exceed 20%, a one-time surcharge of the difference in customs duty will be imposed.
For misclarifications that exceed 20% of the difference, a two-time surcharge of the difference in customs duty will be imposed.
In previous guidelines under CAO 01-2014, two times the surcharge is imposed on misclarifications of more than 20% but not exceeding 30%.
For undervaluation and misdeclaration in weight, measurement, or quantity, when the percentage difference is 10% or more but does not exceed 30%, a surcharge of two times the difference in customs duty will be levied.
For cases of undervaluation or misdeclaration exceeding more than 30% between the value, measurement, or quantity declared in the entry and the actual value, weight, and quantity, this constitutes prima facie evidence of fraud, penalized under Section 2530 of the TCCP with forfeiture of the property.
BOC noted that surcharges for instances of misclassification, undervaluation or misdeclaration are mandatory except in certain cases.
In cases of misclarification, a surcharge is not mandatory when the entered tariff classification is based on an advanced tariff classification ruling issued by the Tariff Commission which has not been reversed by the Finance Secretary at the time of entry but is subsequently reversed by the Finance Secretary any time from the period the tariff classification was entered to before final liquidation of the import.
Surcharges are also not mandatory when the misclarification, undervaluation, or misdeclaration occurs under the following circumstances:
- When the error is discovered before any payments are made on the entry.
- When the error is the result of manifest clerical mistake made in an invoice entry.
- When the error is the result of an error in return of weight, measure, or gauge, duly certified to under penalties of falsification or perjury by the surveyor or examining official (when there are such officials at the port).
- When the error is the result of an error in the distribution of charges on invoices not involving any question of law, certified to under penalties of falsification or perjury by the surveyor or examining official.
The CAO also noted that surcharges may not be subject to compromise under Section 2316 of the TCCP. Surcharges properly imposed cannot be waived, and “good faith on the part of the importer is not a valid defense,” the order noted. – Roumina Pablo
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