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Author Topic: Pilipinas Shell Facing Multi-Billion Smuggling Case  (Read 584 times)


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Pilipinas Shell Facing Multi-Billion Smuggling Case
« on: October 14, 2010, 02:07:06 pm »
The Bureau of Customs (BOC) on Thursday filed before the Department of Justice (DOJ) P24.48-billion technical smuggling charges against the multinational oil company Pilipinas Shell Petroleum Corporation (Pilipinas Shell).

In a press conference, BOC Commissioner Angelito "Lito" Alvarez said that Pilipinas Shell was criminal sued for intentional misclassification and misdeclaration of its various petroleum importations between August 2005 and May 2009 to evade the payment of correct excise and value-added taxes.

Charged were Pilipinas Shell officers and employees namely, Nigel T. Avila, country tax manager; Brian Khriz Acosta, Carolyn A. Francisco, Ma. Cristina Rago and Janie delos Reyes, employees; and customs brokers Diosdado G. Bagon, Jorge T. Pascual, Jr. and Mary Grace M. Maleon.

Also charged were a number of John Does and Jane Does, among them customs employees who conspired or colluded with one another or other personalities to defraud the government of much-needed revenues.

Records of the case show that in 52 import entries filed in 2007, 2008 and 2009, Pilipinas Shell officers, employees and customs brokers intentionally misclassified their shipments of catalytic cracked gasoline (CGG) under Harmonized System (HS) Code 2710.1130 that is intended for tetrapropylene.

Alvarez said that the ploy was obviously carried out to cheat the government of billions of pesos since tetrapropylene was not among the articles enumerated under Section 48 of the National Internal Revenue Code (NIRC) as subject to excise tax.

He noted that those acts of deception in 52 entries effectively deprived the government of lawful revenues from excise tax and VAT estimated at P2,483,633,298.45.

The respondents also allegedly misdeclared their importations between August 2005 and December 2008 as merely CCG or lights catalytic cracked gasoline (LCCG) when in truth, the corresponding invoices issued by Shell International Eastern Trading Company (SIETC) as well as the documents provided by the shipping companies described those shipments as containing unleaded premium gasoline.

The NIRC pegs the excise tax for leaded premium gasoline at P5.35 liter of volume capacity while that of unleaded premium gasoline at P4.35.

Alvarez said that the dutiable value of all 52 entries summed up to P15,436,449,446.89 with a corresponding excise and value-added taxes totalling P2,720,768,483.45.

He added that since Section 3611(c) of the Tariff and Customs Code of the Philippines stipulated that the fraudulent acts and practices committed by the accused could be penalized by as much as 800% surcharge (equivalent to P21,776,147,867.60), the total amount the "BOC is demanding from Pilipinas Shell sums up to P24,486,916,356.00."

Alvarez said that the criminal case filed against Pilipinas Shell was different from the latter's tax collection problem with the BOC that had yet to be resolved by the Court of Tax Appeals (CTA).

"The difference lies in the fact that the bone of contention in the tax collection case centered on the question of whether the catalytic cracked gasoline (CCG) or lights catalytic cracked gasoline (LCCG) that Pilipinas Shell imported were merely blending materials and therefore were exempt from being assessed excise taxes or were actually finished or refined petroleum products subject to excise tax," Alvarez said.

source: PNA

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