The decision was made, according to Finance Undersecretary Gaudencio A. Mendoza when issuing the order, in response to the proposal of the Export Development Council (EDC) for returned export shipments to be exempted from import duties.
Veteran exporters have long been complaining that the goods they fail to sell when they join international trade fairs, or those that get rejected by buyers or importing countries for one reason or another, have been subjected to import taxes under the country’s tariff and customs code.
Mendoza ordered the goods exempted from taxation starting this month.
The catch in Mendoza’s order is that, owners of the returned goods still have to go through a long process, and a lot of documentation to enjoy the tax exemption.
First, the exporter who already lost money for failing to sell his products has to produce an affidavit explaining why the exported goods have been returned.
Then, he has to produce import documents that include an invoice, a bill of lading and a packing list.
And he has also to produce export documents that include an export invoice, a bill of lading, an export declaration and certificates of inspection and loading in case the product has been brought out for a trade fair.
All those documents will have to be forwarded directly to the record section of the department and a verification process on whether the goods enjoy duty drawback or tax credit begins. (Abe P. Belena/Philexport News and Features/Sunnex)
