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Customs complains ’09 target hard to meet

10/31/2008

The Bureau of Customs (BoC), a perennial revenue underperformer, has already forwarded an alibi in case it fails to meet a government-set P300 billion target for next year.

Customs Commissioner Napoleon Morales said he is supporting proposals of lawmakers to review the 2009 revenue target owing to the continuous drop in oil prices in the world market.

The Development Budget Coordinating Committee (DBCC) has set a P300.059 billion collection target for the BoC.

A number of lawmakers are calling for a review, citing the current issues such as the US recession and the lower remittance of overseas Filipino workers, among others.

“Some senators are calling for a review of the targets to check on the estimates and the assumptions set by the DBCC, because when they set the target, these events were not yet in motion,” he said.

Morales explained that although he sees the drop in prices as revenue neutral for this year with the windfall from the previous months, meeting the 2009’s revenue goal will be hard for the bureau since the world is experiencing a global economic crisis which affects the whole world.

Traders said the primary reason for the inability of Customs in hitting its collection targets is the still rampant cases of smuggling in the country.

“For now, it is still revenue neutral because there is an EO by Malacañang and there are trigger prices set by the Department of Energy which pegs which percent of tariff we should collect if the prices of oil hit a certain level,” he said.

The bureau’s 2009 collection is based on a foreign exchange rate of P42, it is higher by P46.059 billion or 11.8 percent from this year’s P254 billion collection goal. The current peso-dollar rate is pegged at P49.20.

Under the target, import duties are expected to collect P79.235 billion while the tax expenditure fund is expected to generate P23.371 billion.

The government is looking to get the biggest amount on value added tax on Imports which is at P205.030 billion, while excise and other taxes are expected to fetch P15.793 billion next year.

Import growth rate for next year has also been increased to a 10 percent growth.