Customs denies conspiracy in oil smuggling case

MANILA, Philippines – Customs Commissioner Napoleon Morales said yesterday there was neither an “omission” nor a “conspiracy” with oil firm Jetti Supply Distribution Inc. (JSDI), which allegedly failed to pay P288 million in taxes from importing oil from 2006 to 2008.

“I’m confident that there is no omission on my part, that’s it,” he told reporters.

The Presidential Anti-Smuggling Group (PASG) filed before the Office of the Ombudsman a case against Morales for allegedly allowing JSDI to smuggle oil into the country and defrauding the government of import taxes.

The other respondents in the case were Mindanao Container Terminal Port collector Rudy Amistad and JSDI officials Ramon Tanchangco, Joel Aguilar, Joselito Magalona and Darwin Suico.

Morales said as early as last year, the Post Entry Audit Group (PEAG) of the Bureau of Customs (BOC) conducted an audit of JSDI importations for 2006 to 2008, and the BOC’s legal service started an investigation last March 6 to determine how much the government lost in revenue.

“So there is no omission, so conspiracy will not take place,” he said.

BOC officials said JSDI imports about P1 billion worth of finished petroleum products per year. Since oil is a liberalized commodity, any company can import it, subject to taxes.

BOC policy allows companies to self-assess taxes on their imports for the first three years of operation. After that, the BOC’s PEAG will check whether correct payments were made, and slap penalties on firms that undervalue their taxes.