Car import loophole shut
Some businessmen who are engaged in importing high-end luxury cars to the Philippines haven’t been too cheerful lately, it seems.
According to our source in the automotive industry, the shift in temperament of these businessmen began when the Bureau of Internal Revenue (BIR) issued Revenue Memorandum Order (RMO) 21-2013, which outlines new procedures for the processing and issuance of Authorities to Release Imported Goods (ATRIG).
So what caused these luxury car importers’ to bare their fangs? Apparently, under the old system (RMO 35-2002), car importers would bundle several vehicles under one ATRIG. This allowed tremendous tax savings (or revenue losses for the government, depending on your point of view) due to their practice of combining entry-level vehicles with top-of-the line models in one container. According to our source, the funds that were saved in tax duties were enough to sustain the importers’ high-flying ways.
However, with the new “one ATRIG, one automobile” policy in place, each vehicle is now assessed for its individual value, thus ensuring parity and efficiency in tax collections. Unfortunately for the importing businessmen, this also means that the loophole that worked for them for so long has now been shut. Coupled with the rumor that the BIR will also start pressuring these importers on back taxes (including one supposedly for as much as P2 billion), it’s no wonder that these importers have, of late, been hissing like angry felines. Daxim L. Lucas
Clarifying weight gain
Swamped with queries from trading participants since Friday, the Philippine Stock Exchange had to issue Tuesday a memorandum to address confusion on the index weight of property developer SM Prime Holdings Inc. This was after the stock market was prematurely excited on Friday on an alleged overnight increase in SMPH’s weight.
In the memorandum, PSE chief operating officer Roel Refran clarified that the increase in the index weight of SMPH on Oct. 25 (which was reflected in the PSE’s online database), was a result of the increase in the outstanding shares of SMPH that took effect on the same day pursuant to its merger with SM Land Inc. (which thus boosted its market capitalization overnight). This was part of the consolidation of key SM property units under a single listed vehicle under SMPH, creating Southeast Asia’s largest property company, as approved by the Securities and Exchange Commission.
“No adjustment was made to the free float of SMPH in the index,” Refran said. “Any adjustments to the free float of index constituents arising from corporate actions are made, in general, on a quarterly basis,” Refran said, adding this was in accordance with the existing PSE policy on index management. “The adjustments are based on changes such corporate actions may have on the free float as reflected in the public ownership reports submitted by listed companies.”
SMPH, the second most actively traded company on the PSE yesterday, declined by 5.52 percent to close at P18.50 a share. This was after the company’s share price surged by 15.86 percent on Friday to P19.58 before the long weekend when the market prematurely speculated that SMPH’s index weight had gone up to 6.01 percent from 3.3 percent. Doris C. Dumlao
Betting on Megaworld
Speaking of index rebalancing, with the next MSCI review due this November, the guessing game has started on which companies may be included. COL’s high networth investor-focused private clients’ group (PCG), in the Oct. 21 publication “Room with a view,” said Megaworld Corp. (which was among those stricken off the MSCI small cap index in the May 2013 rebalancing) is a strong contender.
“After examining the previous MSCI additions/deletions since 1998, we noticed that there is a trend for larger cap companies to be removed from the small cap index and then added into the global standard (large cap) index two or three review periods thereafter,” PCG said in the publication.
PCG noted that this happened to URC and ICTSI. In the case of URC, PCG noted it was removed from the small cap index in August 2011 only to be added to the next review in November 2011, while ICTSI was removed from the small cap in February 2011 and added to the global standard in May 2011.
“As November is approaching, we believe that MEG, with a market cap of P114 billion, free float of 36 percent and very active value turnover is a strong contender to be included,” PCG said. Doris C. Dumlao
RSA for barangay captain
Businessman Ramon S. Ang— more popularly known by his initials “RSA” — is apparently nurturing a dream to become a public servant. But it seems his aim is not set on high-level positions in government.
At the sidelines of the signing of a concession agreement between the San Miguel group and the Albay Electric Cooperative, Ang shared a light moment with reporters as talk veered toward the recently held barangay elections.
Ang, who was unable to vote due to “severe headache” after dining at a certain Chinese restaurant (which he declined to name), said he was entertaining thoughts of becoming a barangay captain someday. “I wish to run for the position of barangay captain when I’ve retired,” he quipped.
Asked where, Ang said it would probably be in the countryside. “Of course I’ll relocate to the province when I retire. Somewhere mountainous,” he said.
Whether or not he will actually put to use his management expertise to run a village in the countryside, it would please one particular “activist stockholder” of Petron (who has been known to hog the microphone during annual stockholders’ meetings) that Ang has, apparently, given his suggestion some thought. Riza T. Olchondra
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