18/03/2011 (Philippine Daily Inquirer) - A major importer of palm oil was slapped with a P2.2-billion smuggling suit that the Bureau of Customs filed Thursday in the justice department.

At a press conference, Customs Commissioner Angelito Alvarez identified the company as Trans-Asia Philippines Manufacturing Industry.

The Caloocan City-based firm had allegedly declared a per kilo value of as low as P6.60 for the refined, bleached and deodorized (RBD) palm oil it imported from Malaysia between January 2010 and February this year.

Named in the charge sheet were Jason Uy Sio, the company’s import manager, and customs brokers Benjamin Valic, Elinda Dumalaog and Joey Laurente.

Few precedents

Deputy Customs Commissioner Gregorio Chavez, who also heads the agency’s Run After the Smugglers, said in a statement that “the scale of undervaluation committed by Trans-Asia which was well in excess of 75 percent had very few precedents in the history of the Bureau of Customs.”

Alvarez said the bureau would still have to check with the Securities and Exchange Commission on the identities of Trans-Asia’s owners and top officers.

“They would also be liable and would also be charged,” he said.

Alvarez said Trans-Asia ranked No. 138 among the country’s companies in terms of volumes of imports but was only No. 414 when it came to paying taxes.

Alvarez said an investigation showed that in 14 months, Trans-Asia imported a total of 38,694,261 kilograms of RBD palm oil with a declared per kilo value ranging from 15 US cents (P6.60) to 50 US cents (P22).

Cheaper than bottled water

Alvarez noted that this made a kilo of palm oil “suddenly cheaper than a liter of bottled mineral water.”

RBD oil is used for home cooking and commercial food processing. It is also used as raw material to manufacture soap, washing powder and other hygiene and personal care products.

The value-added tax (VAT) for Trans-Asia’s oil shipments, broken down in 17 import entries, were assessed to be worth just P64.8 million since the company declared a dutiable value of only P532.8 million.

However, other importers have declared a per kilo value of $1.18 for the same RBD palm oil bought from the same source within the same period, Alvarez said.

Correct value

Using the correct value of $1.18 a kilo, Trans-Asia’s imports would have a total value of P2.2 billion for which it should have paid VAT amounting to P264.5 million.

Alvarez said that while Trans-Asia had tried to save P199 million with the undervaluation of its imports, the company should now pay a total of P2.2 billion, which is the sum of the dutiable values of its 17 import entries during the 14-month period.