Effective December 1, the Bureau of Customs (BOC) will implement a new order on how motor vehicles should be described in import entries.
Customs Memorandum Order (CMO) No. 26-2014, dated November 12, outlines the requirements for describing motor vehicles in the import entries of the single administrative document (SAD) and BOC’s electronic-to-mobile (e2m) system.
The new order also repeals sections of CMO 28-2007 that deal with the description in tariff terms of imported motor vehicles.
Covered by the new CMO are cars, buses, trucks of all types, tractors, motorcycles, special-purpose vehicles, golf carts, and completely knocked-down units of such vehicles.
Under the CMO, all import entries for motor vehicles must contain certain information under item 31 (description of goods) of the single administrative document (SAD) filed in BOC’s electronic-to-mobile (e2m) system, as well as in the paper copy of the import entry and internal revenue declaration (IEIRD).
The required information include at least the following: make (brand), series, body type, the word “used” only if the motor is used, and year of the model only if the motor vehicle’s model year is different from the year when the entry is being filed.
BOC stressed it is mandatory to fill in accurately the number of units of motor vehicles for each item in Section 41 of the SAD and IEIRD.
Each item in the import entry must contain only one brand and one model per motor vehicle. Other brands and other models should be declared separately in individual items. Different brands and different models of the same brand should be listed in separate items. Likewise, new and used cars and used cars of different models years should be in separate items.
The CMO also noted that the following are still required in supporting documents, but not in the IEIRD: body type, year model, gross weight, net weight, piston displacement, number of cylinders, engine number, chassis number, vehicle identification number, and fuel type.
The BOC’s examiner (COO or equivalent officer) is responsible for ensuring that all import entries of motor vehicles fulfill CMO 26-2014 requirements. Clearance by any examiner of an import entry that does not meet requirements will be considered an incident of simple neglect of duty punishable upon second offense with dismissal.
Revised depreciation formula for imported motor vehicles
In related developments, BOC recently released revised the depreciation schedule for imported motor vehicles under Customs Administrative Order No. 07-2014, which replaces CAO 05-2011.
The order, dated October 28, now says that the rate of depreciation for tax-exempt vehicles shall be computed based on the straight line method at 10% for every year but not exceeding 50%, instead of the 90% in CAO 05-2011.
For used trucks and heavy equipment, the rate of depreciation should also follow the straight line method at 10% for every year but not exceeding 50%, instead of the 90%.
According to BOC, imports of motor vehicles contributed to the 15.7% growth in imports for the month of September.
CAO 07-2014 takes effect 15 days after publication in a newspaper of general circulation. – Roumina Pablo
Image courtesy of nipitphand at FreeDigitalPhotos.net
