The Bureau of Customs (BoC) was told to speed up its audit of rice import transactions in 2019, as well as the collection of unpaid tariffs and penalties from erring importers, so it could look into more recent cases of undervaluation in rice importation.
This was after the agency reported that it had assessed some forty importers a total of P1.4 billion in additional tariffs and penalties for undervaluing their rice shipments between March and June 2019.
In a statement, the Federation of Free Farmers (FFF) commended the BoC for finally addressing the issue of undervaluation of rice imports following FFF’s revelations that importers may have shortchanged BoC of nearly P2.8 billion in tariff revenues since the enactment of the Rice Tariffication Law in March last year.
“The BoC report is probably just the tip of the iceberg. Our analysis shows that undervaluation and misdeclaration have continued unabated and even worsened in 2020,” said FFF National Manager Raul Montemayor.
A recent FFF study indicated that the discrepancy between FOB (point of origin) prices as declared by importers and the BoC’s own reference values averaged P945 per ton in 2019.
From January to May this year, the gap increased two and half times to P2,416 per ton.
Total revenue losses from undervaluation from March 2019 to May 2020 alone were estimated at P1.6 billion, according to FFF.
Montemayor said that during a meeting with the FFF in July, the BoC disclosed that some shippers had apparently connived with importers to invoice freight and insurance charges as “other charges” so that these would not be included in tariff computations.
This, according to him, resulted in additional uncollected tariffs of around P1.1 billion.
Moreover, some P134 million in tariffs were not collected when the BoC assessed imports from India and Pakistan with only 35 percent tariff instead of 50 percent.
“We hope the BoC will resolve all these cases quickly and finally end the practice of undervaluation. We also ask the BoC to be transparent and reveal how many import shipments are under investigation, how much in security bonds have been collected from them, and what monetary and other penalties have been imposed on erring importers,” Montemayor said.
“We are interested not only in who are caught but also those who might get away,” he added.
Last year, the Department of Agriculture (DA) committed to investigate this matter but has not released any findings so far.