BOC’s post audit collection down 41% in 2020

  • The Bureau of Customs Post Clearance Audit Group (PCAG) collected P1.2 billion in 2020, a 41% drop from 2019 revenues
  • Of the total, P171.485 million were from companies issued audit notification letters, and P1.047 billion from those that applied to the Prior Disclosure Program
  • For 2020, PCAG issued 168 notification letters and approved 70 final audit reports/clean reports of findings
  • PCAG received prior disclosure applications from 77 companies in 2020, approved 13 and denied nine

The Bureau of Customs (BOC) Post Clearance Audit Group (PCAG) collected P1.2 billion in 2020 from its conduct of regular audits and the Prior Disclosure Program (PDP), 41% below its P2.061 billion revenues in 2019.

Of the latest figure, P171.485 million was collected from companies issued with Audit Notification Letters (ANL), while the bulk or P1.047 billion was from companies that applied to PDP, according to BOC’s 2020 annual report.

For 2020, PCAG issued 168 ANLs and approved 70 final audit reports/clean reports of findings. PCAG also received PDP applications from 77 companies, approved 13 and denied nine.

An ANL informs a company that it will be subjected to post-clearance audit and contains information on the audit procedure. The PDP, formerly called Voluntary Disclosure Program, on the other hand, is based on international best customs practice that allows importers to voluntary pay for discrepancies in duties and taxes of previous shipments before post-clearance audit.

PCAG, in a statement, said it is optimistic about collecting additional revenues from the post-clearance audits, which commenced in 2019.

At present, there are still 26 demand letters for collection of an estimated amount of P12 billion. There are also 18 demand letters, amounting to P5 billion when collected, which are undergoing motion for reinvestigation/reconsideration, and eight demand letters for collection amounting to P6.9 billion that remains unpaid, with cases for referral to BOC’s Legal Service for filing of a collection suit.

The function of the post-clearance audit, formerly called post-entry audit, was returned to BOC in 2016 from the Department of Finance, where the function had been transferred in 2014.

In 2018 PCAG started welcoming applications to PDP and in early 2019, began sending out ANLs with the release of Customs Administrative Order No. 01-2019, which implements BOC’s post-clearance audit function.

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

Such audit intends to ascertain if the goods valuation is correct and determine if the importer is liable for duties, taxes, and other charges, including any fine or penalty. – Roumina Pablo

This post was published on January 14, 2021

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