All importers of “branded, high-end cars”—not only PGA Cars Inc.—are undergoing an audit of the declared value of their imported units, according to the Bureau of Customs (BOC).
PGA Cars, which imports Porsche and Audi cars, has submitted its books of accounts to the agency, Customs Commissioner Rozzano Rufino B. Biazon told reporters on the sidelines of the National Competitiveness Council’s Ease of Doing Business Summit. All other importers of branded high-end vehicles (Jaguar, Land Rover, etc.) were also being audited, he said.
“They have to comply, otherwise we can suspend their import license,” he said.
Biazon explained that the books of accounts were needed for the audit because documents presented at the port of entry only showed such data as the declared value of the units.
“Remember, we signed the WTO (World Trade Organization) agreement on adopting the transaction value method. The price agreed upon by the buyer and the seller, that is the transaction value. But the books of accounts will show more data, for example, what costs they reported to the Bureau of Internal Revenue,” he said.
“The audit is ongoing and results will soon be released,” Biazon said. “We’re just waiting for the report from the post entry audit group of the BOC.”
If the BOC finds that importers had underpayments or undervaluation (discrepancies between the declared value of the cars and quoted prices) they would simply be asked to pay the difference. If the audit would show misdeclaration of imports, they would be charged penalties, Biazon said.
Last March, the BOC said it had notified PGA Cars of the audit in February. Each audit period may cover the past three years of a company’s operations.
Biazon said this was not the first time car companies have been subjected to a post-entry audit. Vehicle importers from the so-called gray market as well as companies that import as well as assemble locally were also monitored, he said.