Home » Aviation, Customs & Trade, Ports/Terminals » CCBI questions ‘improperly imposed’ customs penalties on shipments

The Chamber of Customs Brokers, Inc. (CCBI) is requesting the Bureau of Customs (BOC)-Ninoy Aquino International Airport (NAIA) to revisit actions taken by assessment officers, specifically the alleged improper imposition of penalties and surcharge on misdeclared, misclassified, or undervalued shipments.

In a letter dated January 3 signed by president Atty. Ferdinand Nague to NAIA officer-in-charge district collector Ramon Anquilan, CCBI said reports have reached the group “of the improper application of penalties for either misdeclaration, misclassification, or undervaluation in goods declarations under Section 1400 of the Customs Modernization and Tariff Act (CMTA).” The letter was coursed through BOC-NAIA’s Law Division and was received by BOC-NAIA on January 4.

Cited as an example was an entry that was “erroneously imposed” a 250% penalty of P2.618 million in total duties and taxes for the shipment when only two of the eight items were allegedly misclassified.

CCBI said Section 1400 of CMTA did not specifically mention the application of the surcharge on the total duties and taxes of the entire shipment. Quoting Section 1400, CCBI stated that “Misdeclaration as to quantity, quality, description, weight, or measurement of the goods, or misclassification through insufficient or wrong description of the goods or use of wrong tariff heading resulting in a discrepancy in duty and tax to be paid between what is legally determined upon assessment and what is declared, shall be subject to a surcharge equivalent to two-hundred fifty percent (250%) of the duty and tax due.”

CCBI pointed out that “nowhere in the letters of the law, which provides for the imposition of the penalty to be based on the total duties and taxes as it is just logical to state that the provision of the law refers only to a single tariff line affected and not all the tariff lines not affected by the misclassification.”

“Thus, if misclassification is committed, the application of the surcharge of 250% of the duty and tax due is on or against the misclassified item or items only and not on the entire items or goods which are correctly classified,” CCBI added.

The group said that “if the language used in the statute is clear, unambiguous and unequivocal, it deserves a literal interpretation.”

CCBI also said that “it is illogical and absurd application of the law if the surcharges are to be imposed against the entire shipment not affected by the technicalities.”

It further noted that logically, the items or goods that were correctly classified or declared shall not be subjected to surcharge under Section 1400 as their duties and taxes have not resulted in discrepancy.

The group said, moreover, that “penalties should be liberally construed in favour of the tax payer.”

“Statutory provisions for the levying of fines and penalties for valuations of customs laws are entirely separate and distinct from the provisions which seek the determination of the duties properly due on importations. They have been held to be penal or quasi-criminal and to require strict construction and their operation was held not excluded by the national prohibition statutes,” it explained.

CCBI said “generally, whether a statute would be strictly or liberally construed would depend on the type or nature of the statute involved. Thus, penal statutes, or those imposing penalties or punishment in various forms of crimes are to be strictly construed.

“Thus, it is a settled rule that fees not authorized by statute may not be exacted by customs officers even though such exaction is based on long usage or under instructions or regulations of the secretary (of Finance),” CCBI pointed out. – Roumina Pablo

 Image courtesy of adamr at FreeDigitalPhotos.net

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