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BOC steps up probe of oil, cigarette smuggling

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Revenue leaks

BOC steps up probe of oil, cigarette smuggling

By: - Reporter / @bendeveraINQ
/ 12:12 AM February 11, 2017

The Bureau of Customs (BOC) Friday warned suspected smugglers of cigarettes, luxury cars and oil products that their days were numbered, as the agency intensified probe of their unscrupulous activities that cost the government foregone revenue equivalent to a tenth of its annual collection target.

“Customs Commissioner Nicanor E. Faeldon, in response to public clamor for investigation, has directed the BOC intelligence and investigation service to look into reports of rampant oil, luxury vehicle and cigarette smuggling in many parts of the country,” the BOC said in a statement.

“The BOC has a list of companies suspected of being engaged in the [smuggling] of oil, motor vehicles (including high-end importers) and cigarettes bearing fake Bureau of Internal Revenue tax stamps to defraud the government,” it added.

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BOC data showed that smuggling of cigarettes, oil and luxury vehicles were the “top sources of revenue leaks,” with foregone revenue reaching more than P50 billion yearly or about 10.7 percent of the annual revenue target averaging P467.9 billion, the country’s second largest tax-collection agency said.

Citing reports of the Washington-based watchdog Global Financial Integrity as well as the International Monetary Fund, the BOC said it had been unable to collect P22.5 billion from oil, P21 billion from vehicles and P16 billion from cigarettes due to smuggling each year.

Other estimates on foregone revenue from the smuggling of these products were at a higher P165.5 billion or about $3.85 billion yearly, the BOC said, citing its records.

Faeldon said he wanted to end during his term as BOC head “prevalent” misinvoicing of imported goods as well as fraudulent misrepresentation or misdeclaration—both underdeclaration and overdeclaration—of the real value of imported goods.

“We are ready to use all available options in the probe against erring companies [importing] oil, motor vehicles and cigarettes to make sure we control all forms of revenue leaks that are seriously detrimental to hitting revenue targets… It will never be an easy task for us, but we will toil hard through sweat and blood, only to make sure that we do our jobs in our faithful compliance to our mandated tasks as public servants,” Faeldon said.

“The probe is part of the BOC’s mandated effort to collect revenues, stop bribery in the agency, and ferociously snuff smuggling to hit revenue targets and enforce critical reforms in line with the policies of President Duterte,” he added.

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TAGS: BoC, Business, economy, News, Smuggling
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