The Bureau of Internal Revenue and the Bureau of Customs, the principal revenue-collection agencies of the government, have both fallen short of their collection targets. Commissioners Kim Henares of the BIR and Ruffy Biazon of the BOC were at the Kapihan sa Manila at the Diamond Hotel last Monday to explain, but Commissioner Henares was summoned to the Senate for a committee hearing. Commissioner Biazon traced the collection shortfall of the BOC to the decline in imports, the reduction and lifting of tariffs as agreed upon in the World Trade Organization (WTO) and to smuggling.
There is a decline in world trade due to the world recession, Biazon explained, so naturally there is also a decline in imports and exports. Then, following the WTO agreement, nations have to gradually lessen and ultimately remove tariffs on imported goods. Finally, there is smuggling. Put all these together and the Customs revenue collection will decrease.
Biazon was quick to add, however, that the claim of local hog raisers that the smuggling of frozen pork is the cause of their woes is not correct. Locally grown pork, the hog raisers said, cannot compete in price to the smuggled frozen pork. Not true, said Biazon.
Why is locally raised pork more expensive than imported pork when the latter has to pay freight costs before they get here, Biazon was asked.
Answer: Because of the high cost of feed and transportation. Don’t blame us, Biazon said, blame the feed millers. Blame the truckers who have raised the transportation costs so that by the time the hogs reach the wet market, the add-ons have raised the pork price.
But the feed millers will say, don’t blame us, blame the shortage of yellow corn and other feed ingredients. And the truckers will say, don’t blame us, blame the petroleum companies. Everybody knows that the cost of fuel has gone sky high. And blame the tong-collecting policemen and local government units, and the high toll rates at the NLEx and SLEx. There are so many police checkpoints, and we have to give several kilos of pork to each of them. Every time we pass a municipality or city, the local government demands payment. And you know, the road-toll rates have risen tremendously. Add all those costs up and the price of our pork will be very high by the time it reaches the market.
Biazon added that imported frozen pork does not compete with local pork in the wet markets. Imported pork goes to food processing plants and canning factories. It comes out as corned beef, bacon, luncheon meat, and as other kinds of processed food.
Which brings us to the subject of botcha or “double dead” pork—hogs that die of diseases and then are butchered and sold in the markets. Eating botcha puts consumers in danger of getting infected with the disease that killed the hogs.
The big amount of botcha being caught and confiscated by government agents in the markets every day is a sign that many hogs are dying of diseases. Which leads to the suspicion that an epidemic is spreading in the hog farms. The wonder is why the Bureau of Animal Industry and the Meat Inspection Board have been very quiet about this. Or why they are not doing anything to stop the spread of the disease.
Are they afraid that people will panic and will not eat pork, thus killing the hog industry, if word spreads that an epidemic is killing local hogs? How safe, really, is the pork being sold in the wet markets and talipapa? Or the thousands of lechon being roasted and sold almost everywhere? Or the barbecued meat being sold at sidewalk stands?
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Back to Biazon and the BOC and its collection targets. Biazon explained that their collection targets are set by the Department of Finance at the beginning of the year, and most often they are not realistic. No matter how much you collect this year, the target for next year is always higher. This year, the target is 30 percent higher than that of the year before. Sometimes, no matter how hard the BOC tries, it cannot meet the target due to many factors. When there is a recession, naturally there is a decrease in imports. When tariffs are reduced, it follows that revenue would also decline even when there is an increase in imports. And when there is smuggling, there is a loss of revenue.
While admitting that smuggling is going on, Biazon claims that the BOC has been slowly but surely closing all the loopholes. It is clamping down on crooked brokers and erring Customs employees. It is cramping the style of the hordes of fixers swarming all over the Customs area, including the fake media people, the so-called hao-shiaos (fixers pretending to be reporters, people publishing tabloids that circulate only in the BOC, and “reporters” without newspapers).
Do you know that there are more “media people” covering the BOC than all the legitimate reporters covering Congress and Malacañang put together? And yet do you see many stories about the BOC in the newspapers despite the fact that so much hanky-panky is going on there?
Biazon said the BOC has reduced the number of reporters accredited to the bureau to only 40. Forty? That’s still too many. There are not that many legitimate reporters covering Customs. Some of them must be fixers.
On the fear of some that raising the excise tax on cigarettes by more than 1,000 percent will encourage smuggling, Biazon said the BOC and the Coast Guard will prevent that. Brave words. The Philippine coastline is so porous with so many islets, islands and beaches, and the BOC and the Coast Guard will have their hands full trying to stop smuggling. Other countries that raised their sin taxes have seen a decline in their revenue collections because of smuggling.