Customs exceeds watered down target last year

MANILA, Philippines — Revenues raised by the Bureau of Customs exceeded a watered down target last year but pandemic damage was still obvious from lower collections.

Customs, which typically accounts for a fifth of state revenues, collected P539.66 billion last year, beating a P506.15-billion goal, preliminary data showed.

Customs’ stellar performance, however, was largely aided by a target lowered three times this year in April, June and September to account for lackluster trade that translated to dismal collections of Customs duties.

Worse, finance department data showed that last year’s revenue take was down 14.4% from P630.57 billion in 2019. The year-on-year drop was also significant as it was the worst decline since the aftermath of the global financial crisis in 2009.

Final Customs collection figures will be released by the Bureau of the Treasury in March.

Based on Customs' report, the typical surge in imports to meet high demand during the holiday season likely did not materialize. In December, the bureau collected P47.316 billion, down 9.36% year-on-year albeit still 9.1% above its downwardly revised revenue goal for the month.

Still, Customs considered 2020 a good year for the bureau. "The BOC’s positive revenue collection performance is attributed to the improved valuation and intensified collection efforts of all the ports, gradual improvement of importation volume and the government’s effort in ensuring unhampered movement of goods," the agency said.

Imports had been down for 19 straight months ending October after the health crisis prompted lockdowns of cities globally. This, in turn, dampened business and consumer confidence reducing demand for goods and services.

The scenario gave little reason for traders to import goods as local supplies remained sufficient. Duties paid in imports, which had been falling for 19 straight months ending October, are Customs’ main source of income.

Adding to Customs’ struggles was a strong peso that capped last year at an over 4-year high against the dollar. A strong local currency allows traders to purchase imported goods at much lower costs. Import costs, in turn, serve as base for computing Customs duties.

By revenue source, Customs said 10 of 17 collection districts exceeded their respective targets in 2020 namely the ports in Cebu, Tacloban, Surigao, Cagayan De Oro, Zamboanga, Davao, Subic, Clark, Aparri and Limay.