Press Release
August 23, 2015

Recto: Hike balikbayan box tax-exempt value; use BOC intel fund, X-rays to catch bigtime smugglers

The chair of the Senate Finance Subcommittee reviewing the Bureau of Customs (BOC) budget said agency officials will be grilled on the status of non-intrusive inspection techniques, which could detect contraband goods without opening tens of thousands of balikbayan boxes sent home by overseas Filipino workers (OFWs).

"There are ways to catch the rat without burning the entire house down," Senate President Pro-Tempore Ralph G. Recto said in stressing "that programs to find big-time smugglers and not a few bars of bath soap in a balikbayan box" are already funded under the BOC's operating budget this year.

One of these is the P298 million allotted for the upkeep of 30 Made-in-China "big" X-ray machines which are installed in the country's 10 biggest ports, Recto said.

The X-ray machines, which can scan one 40- and 20-foot shipping container in minutes, were acquired in 2006 at a cost of $2.5 million each through a loan from the Chinese government.

Recto said under a Palace order governing the "Non-Intrusive Container Inspection System," each 40-footer van is charged a "container security fee" of $10, and $5 for a twenty-footer.

"This year, fees collected from the operation of these X-ray machines will reach almost P1.2 billion," he said. Seventy-five percent of this amount will be used to repay China.

According to Recto, the X-ray program "was meant to do away with manual inspections kasi nga daw kapag ginamitan ng X-ray, parang see-thru na ang loob ng isang van."

"It was designed to replace tedious, inefficient manual and balikbayan box-to-balikbayan box inspection. Ang justification ay gamitin ang teknolohiya para tanggalin ang panghuhula kung ano ang dapat buksan. It was supposed to make the opening of boxes redundant," explained Recto.

To augment the Chinese-made X-ray machines, Recto said the BOC in 2013 invited bidders to a P148 million contract to supply 20 X-ray machines to be installed in airports.

Recto suggested that X-ray machines should also be installed in Post Offices where BOC personnel hold office to check incoming parcel for taxable goods.

"Ito yung dapat ilagay sa mga malalaking Post Offices kasi marami talagang mga OFW na nagrereklamo na isa-isang bubuklatin ang mga padala nila," Recto said.

To remove the motive to check shipped or mailed parcels for dutiable goods, Recto urged the government to triple to $1,500 the current allowed value of the contents of balikbayan box exempt from taxes.

"Sa ngayon kasi, nili-limit ng BOC Memorandum Circular No. 7990 sa $500 ang value ng laman ng bawat balikbayan box. Eh itong rate na ito ay tinakda 25 years ago, noong 1990 pa."

"At iyung mga OFWs natin hindi naman umaabot ng $1,000 ang nilalagay sa box kasi mga sabon lang 'yan at ibang mga anik-anik. Kaya kung tataasan natin ang limit, wala nang motive na halughugin 'yan," he said.

Recto said raising the threshold of balikbayan box value "is a small thing compared to the P2.28 trillion that they sent back home last year."

"Ibalato na natin sa mga OFWs ang balikbayan boxes kasi ang pagpapadala n'yan sa kanilang mga mahal sa buhay ay isang paraan para mabawasan nila ng konti ang kanilang kalungkutan," he said.

Recto said there are also "unspent, unobligated appropriations" for the installation of a CCTV system in all BOC ports and offices.

Earlier, Recto proposed that all BOC inspections of balikbayan boxes be recorded by a camera. "No CCTV, no opening of boxes must be the rule," he said.

Recto said under the Customs bureau's P3.05 billion budget for 2015, "there's P26.2 million in intelligence funds, under 'confidential' and 'extraordinary' expenses."

"Take note na doble ito ng intelligence fund ng BIR," Recto said.

"Lahat ng mga malalaking huli sa BOC were products of good intelligence work and not nitpicking through balikbayan boxes," Recto said.

"There is a need to apprehend syndicates that send drugs and guns through balikbayan boxes. This must be the focus, based on case build up and solid detective work, and not on the random opening of boxes sent by OFWs," Recto said.

"The bigger issue is for BOC to run after big-time smugglers, those who, for example, bring in rice in ships as big as a mall," he said.

"Or, as in the case of the reported smuggling of oil and fuel, in tankers a million times bigger and easier to spot than a balikbayan box," he added.

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