Lawmaker blames revenue shortfall on gov’t failure to stop smuggling

In the wake of new reports the government lost P1 billion in taxes due to undervaluation of rice importation, House Minority Leader Quezon Rep. Danilo Suarez yesterday called on the administration to strengthen its campaign against the unabated smuggling which is taking its toll on the government revenue collection target.

At the weekly minority press briefing, Suarez said the government is obviously barking up at the wrong tree by going after low-salaried employees to augment its revenue collection when it should be going after big-time smugglers.

“The reason we’re not hitting the (revenue) target is the government has failed to arrest the unabated smuggling,” Suarez said. “Why pin down a low-salaried employee when those big-time smugglers are living comfortably in the penthouses of several commercial offices in Makati and at Fort Bonifacio.”

“There has been a report on smuggling of rice, and the information that I received is we’re talking here of over a hundred thousand of metric tons of rice,” Suarez said. “And regardless whether it was misdeclared or undervalued, it’s still smuggling.”

“So what we are saying is at the end of the day, it’s revenue loss for the government,” Suarez stressed.

The other day, Zambales Rep. Ma. Milagros “Mitos” Magsaysay bared that 186,000 metric tons (MT) or 3,600,000 sacks of rice that have been imported from different countries like Pakistan and Vietnam recently were allegedly grossly undervalued.

Magsaysay said the private sector has been importing broken rice which they valued at $110 per MT while the world market values it at $380 per MT.

Reports said the National Food Authority acquires broken rice from the United States at $465 per MT.

“Lugi tayo dahil imbes na $380 ang papatawan ng 40% na Customs duties, sa $110 na lang maniningil ang Bureau of Customs (BoC) ng Customs duties. Ang laki ng mawawala sa government,” Magsaysay said.

According to Magsaysay’s estimate, the government lost $20 million to $23 million worth of Customs duties from the undervaluation of 180,000 MT of rice that the private sector imported.

“It is very enticing to smuggle rice,” Suarez said, “because if you smuggle rice, you automatically save 40 percent from the taxes due the importation. When there is undervaluation, you also save a huge amount in taxes.”

“But it’s not just rice. It’s the unabated smuggling that’s still happening now,” the Quezon solon added. “And this is a serious problem the administration must confront because Customs is the second biggest revenue collection agency in the country.”

Suarez said the minority will include in its proposed congressional performance audit of various government departments the inquiry into alleged irregularity at the BoC when Congress takes a long break in May this year.

“Kasama iyan sa mga review na gagawin namin during the long break where we ask for government agencies to come up with a report on how they performed for the last one and a half years,” Suarez said.  –Charlie V. Manalo, Daily Tribune