Barefaced brazenness

The Philippine Star reports today that Bureau of Customs (BOC) deputy commissioner Alexander Arevalo is puzzled at the public outcry regarding the imposition of duties upon imported books, saying that the BOC merely seeks to follow the law, and that protestors ought to go to Congress or to the Supreme Court. He claimed, furthermore, that, “We are not implementing anything new. The policy has not changed. The book importers know about this. Maybe the readers do not know that they have been paying duties.”

In making such a statement, Arevalo seems to directly contradict Department of Finance (DOF) Undersecretary Estela V. Sales, who, in a telephone interview with Kenneth Yu, said that the duties were allegedly not being implemented, thus prompting the issuance of DOF Department Order 17-09, which contains clarifactory guidelines on the duty-free importation of books, on 24 March 2009. (Manuel L. Quezon III notes that the interview by Yu is the “first time (and so far, the only time)” that the DOF has aired its side of the situation.)

If Arevalo is correct, which duties has the public been paying? Based on the department order, there are only two “legal” rates: 1% and 5%. Arevalo then ought to be able to explain the experiences of these individuals: (1) Jarius Bondoc, who paid Php3,800 in import duties for books worth Php1,350; (2) Roland Benzon, who paid at least 15% of the value of his books; (3) Quezon, who was charged Php3,841, including VAT, from which books are supposed to exempt; (4) Chingbee Cruz, who was quoted differing rates and was finally told that a shipment of books below U.S.$50 would be duty-free; and (5) sumthinblue, who was charged exorbitant fees over books that she had received for free, and harrassed to boot.

If Sales is correct, how did she come to interpret the non-implementation of duties on imported books as a lapse, considering that previous administrations were presumably aware that such non-implementation was one of the provisions of the Florence Agreement? (And while we’re at it, by what authority does she judge novels as “not educational“, when it is supposed to the Department of Education, Culture, and Sports that determines such things? Quezon points out that this opens up the Rizal Law to legal challenge.) That the BOC recently reported a significant deficit for the first quarter of the year (Php5.2 billion, according to the Star, and Php8.2 billion, according to the Philippine Daily Inquirer), is surely no coincidence. oxar2001law suggests that Republic Act 9335, which establishes a “a Rewards and Incentives Fund and a Revenue Performance Evaluation Board” for the BOC and the Bureau of Internal Revenue, provides a strong motive for officials to increase revenue collections by all possible means.

Even if it is assumed for the sake of argument that the imposition of duties upon books is legal, why can’t these officials get their stories straight? Unfortunately, such glaring inconsistencies are merely symptomatic of how the bureaucracy operates: with the apparent intent of utterly confusing the public, while making a conspicuous–and disingenuous–display of upholding the law.

It is interesting to juxtapose this mess with another recent development. Jess Diaz of the Star reports that, “The committee on ways and means of the House of Representatives has relegated proposals to increase rates of the so-called sin taxes to the freezer.” The proposals, which are for increasing tax rates on various liquor and tobacco products, as well as soft drinks, have been removed from the agenda of the committee. The chair of the ways and means committee, Representative Exequiel Javier of Antique, claimed that he would prefer not to impose new taxes, for while higher tax collections could mean more money for social programs, he would nevertheless “opt for the direct ways of helping them rather than the indirect way”.

In a nutshell, the government believes that not raising taxes on products that cause ill health is “direct helping”, while not imposing duties on books is illegal. Should this reasoning prevail, the Philippines is doomed to become a nation of smoking, alcoholic, obese illiterates. Mabuhay ang Pilipinas!

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