MANILA, Philippines – Global oil price plunge is forecast to drag the Bureau of Customs’ (BOC) revenue losses in 2014 up to P40 billion ($906.04 million*) as the agency sources a sizable portion of its earnings from oil importation taxes.
“The estimated annual loss due to low oil prices, relative to last year, is easily P40 billion,” said BOC commissioner John Sevilla.
Sevilla explained that this is because at least 25% of the agency’s earnings in the first half of 2014 came from taxes charged on oil imports.
Oil prices have fallen almost 50% since June last year, due to excessive supply, a weak global economy, and a strong US dollar.
The BOC has yet to reveal its annual table for its 2014 combined collections across Philippine ports.
But based on its 11-month data, Rappler computed that the agency has already reached P44.12 billion ($999.36 million) of losses even without their combined revenue figures for December 2014.
For January to November 2014, the BOC aimed to collect P219.13 billion ($4.96 billion), but only collected P175 billion ($3.96 billion).
Our computations showed that the ports of Subic, Batangas, Aparri, Iloilo, Cebu, Cagayan de Oro, were the only ports that surpassed collection targets, with a combined total of P118 billion ($2.67 billion), as against their combined target of P104.05 billion ($2.36 billion).
The rest of the ports, including the congested Manila harbor, suffered losses at P58.07 billion ($1.32 billion).
Meanwhile, the Development Budget Coordination Committee, lead by the country’s budget secretary, sets a revenue collection target for the BOC at P456 billion ($10.33 billion).
Sevilla said the agency could only do as much, as oil prices continue to dwindle.
“We can still do double digit this year, but more like a 10% increase, because of the dip in oil prices,” he said.
Appointed in December 2013, Sevilla has introduced several reforms in the corruption-riddled agency, among them are anti-nepotism rules on appointments and designations within the BOC.
This comes after President Benigno Aquino III shamed the BOC in his 4th State of the Nation Address in the same year. – with reports from Mick Basa / Rappler.com
*$1 = P44.15