Customs cites San Jose Builders for tax dues

The BOC added that demand letters were sent by the District Collector of the Port of Manila (POM) to San Jose, CGAC, ISAC and PFMIC in 2015. On July 28, 2015, the District Collector sent a final demand letter to the surety companies. (Photo: Philippine News Agency)

MANILA –The Bureau of Customs (BOC) has initiated a complaint against the builder of Philippine Arena in Malolos, Bulacan and its three surety companies for failing to settle their tax obligations with the agency amounting to over PHP947 million.

In a statement, the bureau said that its Legal Service transmitted the complaint against New San Jose Builders Company (San Jose) and Centennial Guarantee Assurance Corp. (CGAC), Intra Strata Assurance Corp. (ISAC) and Philippine Fire and Marine Insurance Corp. (PFMIC), to the Office of the Solicitor General (OSG) on Tuesday.

According to the BOC, the due taxes of the real estate company amounts to PHP947,292,025.72.

Republic Act No. 9593, or the Tourism Act of 2009, ensures privileges to companies within the Tourism Enterprise Zone.

Section 86 of the Act provides that “subject to rules and regulations which properly define capital investments and equipment necessary for various kinds of tourism enterprises, registered enterprises shall be entitled to an exemption of 100 percent of all taxes and customs duties on importations of capital equipment.”

The company has availed of the said privilege when it imported construction-related items from 2012 to 2103 in connection with the construction of the multipurpose indoor arena.

It was required to post bonds amounting to PHP947,292,025.72 which were issued by the three surety companies, to cover duties and taxes for its shipments since it did not have certificates of exemption from the Department of Finance (DOF).

According to Atty. Alvin Ebreo, Director of BOC’s Legal Services the exemption was not granted since “there is no legal basis for the exemption.”

Since the DOF did not grant the exemption, San Jose was required to pay duties and taxes due on their importations.

The BOC added that demand letters were sent by the District Collector of the Port of Manila (POM) to San Jose, CGAC, ISAC and PFMIC in 2015. On July 28, 2015, the District Collector sent a final demand letter to the surety companies.

On December 1, 2015, the acting chief of the POM’s Bonds Division recommended the forfeiture of the bonds for the failure of San Jose and the surety companies to settle their obligations, despite the BOC’s repeated demands.

The POM’s Law Division, likewise, recommended the forfeiture of the matured bonds in a memorandum dated September 20, 2016. It was forwarded by the division’s Officer in Charge to BOC Commissioner Nicanor Faeldon for approval.

Section 1132 of the Customs Modernization and Tariff Act provides civil remedies to the BOC for the collection of duties and taxes.

Among these remedies are the distraint of goods and other personal property such as stocks and other securities and the filing of civil or criminal suits against violators.

The Philippine Arena is owned by the Iglesia ni Cristo (INC).