Professional Documents
Culture Documents
As To Exported Articles: Nature of Customs Duties and Tariff
As To Exported Articles: Nature of Customs Duties and Tariff
1. weapons of war
Concept of Goods for Customs duty purposes:
2. gambling devices
As to Imported Articles:
3. narcotics or prohibited
drugs
All articles when imported from any
foreign country into the Philippines shall be
4. immoral, obscene or
subject to duty upon each importation even
insidious articles
thought previously exported from the
Philippines. Except as otherwise specifically
5. those prohibited under
provided for in the code or other laws:
special laws
with agreement with
B. Articles Qualifiedly Prohibited: foreign countries;
1. freight
It is the bringing out of goods from the
2. insurance Philippines territorial jurisdiction.
2. The importation is likely to The President is given by the Tariff and Customs
insure materially established Code ample powers to adjust tariff rates Sec.
local industries or prevent 401 of TCC; empowers the president to:
their establishments.
1. Increase, reduce, or remove existing
Amount of special protective rates of import duty;
duty: Equal to the bounty or
subsidy or subvention. 2. Establish import quota or to ban
imports of any commodity;
3. Marking Duty
3. Impose and additional duty on all
Special duty of five percent (5%) imports not exceeding 10% advalorem
advalorem imposed or articles whenever necessary.
properly marked, collected by the
commissioner, except when such Limitations imposed regarding the Flexible
article is exported or destroyed Tariff Clause:
under the customs supervision and
1. Conduct by the Tariff Commission of an
investigation in which a public hearing 4. All questions relative to the
shall be hold wherein interested arrangement of schedules and
parties shall be afforded reasonable classification of articles in several
opportunity to be present, produce sections of the tariff law;
evidence and to be heard;
5. Tariff relations between the
1. The commission shall also hear the Philippines and the Foreign
views and recommendations of any countries, commercial treaties,
government office, agency or preferential provisions, economic
instrumentality concerned; alliances, the effect of export
bounties and preferential
transportation rate;
1. The commission shall submit their
findings and recommendations to the
6. Volume of importations
NEDA within 30 days after the
compared with domestic
termination of the public
production and consumption;
hearings. The NEDA thereafter,
submits its recommendation to the
7. Conditions, causes and effects
President.
relating to completion of foreign
industries with those of the
Philippines, including dumping and
cost of production;
Administrative Aspect of
Tariff and Customs Laws 8. In general, to investigate the
operation of customs and tariff
Agencies directly concerned with Tariff laws, including their relations to
and Customs Administration: the national revenues, their effect
upon the industries or labor of the
TARIFF COMMISSION country and to submit reports
of its investigation;
Officials of the Tariff Commission are
the chairman and 2 member Commissioners, all 9. Nature and composition and
appointed by the President. the classification and heading
number for customs revenue and
Functions: other related purposes.
Related Provisions:
1) Right of the Police \ officers to
The territorial jurisdiction of the Enter Enclosure
Bureau of Customs embraces “all seas
within the jurisdiction of the Any person exercising police
Philippines, and over all coasts, ports, power conferred under such code
harbors, bays, rivers and inland waters may at any time enter, pass
whether navigable or not from the through, or search any land or
sea.” (Sec. 603, TCC) enclosure, or any warehouse,
store or other building, not being a
Extra-Territorial jurisdiction dwelling house.
A warehouse, store or
(Right of Hot Pursuit): other building or enclosure used
for the keeping or storage of
“Whether a vessel becomes a subject article does not become a dwelling
to a seizure by reason of an act done in house within the meaning hereof
the Philippine waters, in violation of merely by reason of the fact that a
the Tariff and Customs Laws, a pursuit person employed as a watchman
of such vessel, begins with the lives in the place, nor will the fact
jurisdictional waters may contain that his family stays there with him
beyond the maritime zone, and the alter the case.
vessel may be seized in the high seas.
(Sec. 603, TCC). 2) Search of Dwelling House
The Supreme Court upheld the seizure 3) Right to search vessels or Aircraft
and forfeiture as valid despite the fact and Persons or Articles Conveyed
that the importation had not yet begun therein
and that the seizure was affected
outside the Philippine waters. The
Supreme Court held that the authority It is lawful for any person
of a nation within its own territory is exercising police authority under
absolute and exclusive. The power to the TCC to go aboard any vessel or
aircraft within the limits of any Customs Authorities under such
Collection district and to inspect, regulations as may be prescribed
search and examine said vessel or relative thereto. (Sec. 603, TCC)
aircraft and any other trunk,
package, box as envelope on board, Non-necessity of Search Warrant
and to search any person on board
the said vessel or aircraft if General Rule: Persons exercising police
underway, to use all necessary authority under the customs laws may effect
force to compel compliance; and if search and seizures without a search warrant in
it shall appear that any breach or the enforcement of customs laws. (See Sec.
violation of the customs and tariff 2208, TCC)
laws of the Philippines has been
committed, whereby or in Exception: In the case of a dwelling house
consequence of which such vessel (Pacis etc. vs. Pamaran, March 15, 1974).
or aircraft, or the article, or any
part thereof on, on board of or Reason: On grounds of practicality.
imported by such vessel or aircraft
is liable to forfeiture, to make Pertinent Cases on Searches and Seizures
seizure of the same.
1) The legality of a search can be
Note: 1) Such power shall extend contested only by the party whose
to the removal of any false bottom, rights have been impaired thereby and
partition, bulkhead or other that the objection to an unlawful
obstruction. 2) No proceeding search and seizure is purely personal
herein shall give rise to any claim and cannot be availed of by third
fro the damage caused to the parties. (Nasiad, et al. vs. CTA, Nov. 29,
article or vessel or 1994)
aircraft.
2) Warrants of seizure and detention
1) Right to Search Vehicles, Beast issued by the Collector of C covering
and Persons the seizure of imported goods are not
general warrants issued in violation of
It shall also be lawful for a person Section 3 (now section 4), rule 126 of
exercising authority to open and the Rules of Court. Upon effecting the
examine any box, trunk, envelope seizure of the goods, the Bureau of
or other container, wherever Customs acquired exclusive jurisdiction
found when he has reasonable not only over the case but also over
cause to suspect the presence of the goods seized for the purpose of
dutiable or prohibited article or enforcing the tariff and Customs laws.
article introduced into the (Chia vs. Acting Collector of Customs,
Philippines contrary to law and Sept. 26, 1989)
likewise to stop, search ad
examine any vehicle, beast or
person reasonably suspected of 3) The proceedings upon search
holding or conveying such article. warrants must be absolutely legal, “for
there is not a description of process
2) Search of Persons Arriving from known to the law, the execution of
Foreign Countries which is more distressing to the citizen.
Perhaps there is none which excites
All persons coming in the such intense feeling in the
Philippines from the foreign consequence of its humiliating and
countries shall be liable to degrading effect.” The warrants will
detention and search by the always be constured strictly without
however, going the full length of The dismissal of the criminal charge in
requiring technical accuracy. No the Fiscal’s office against respondent
presumptions of regularity are to be Andrulis does not constitute re judicata
invoked in aid of process when an in the forfeiture proceedings. Forfeiture
officer undertakes to justify under it. is in rem, whereas a criminal action is in
(Uy vs. BIR, Oct. 20, 2000) personam. Conviction in the criminal
action is not a bar to forfeiture. Results
of a criminal proceeding being
dependent on the evidence therein will
Customs Forfeiture Actions not necessarily influence judgment in
the forfeiture proceedings.
1. What kind of Actions are Customs
Forfeiture?
Llamado vs. Commissioner of Customs
An action for the forfeiture of seized 123 SCRA 118
goods in the Bureau of Customs is an
action in rem, or action taken against A Cessna plane carrying persons
the Imported goods themselves engaged in the smuggling of untaxed
independently arising from any criminal “blue seal” cigarettes, landed at an
action or action in personam that may airstrip in Alabat, Quezon Province. The
result as a consequence of a violation of plane was also used to bring in “de gaza”
an existing law. Lack of knowledge by kerosene lanterns and kerosene used to
the owner does not generally render light the airstrip to facilitate the loading
the vessel immune from forfeiture. of the cigarettes. The plane was subject
However, the forfeiture of a private to forfeiture pursuant to Sec. 2530 (a) of
carrier used in the conveyance of the Tariff and Customs Code. It is not
illegally imported or exported articles necessary that the vessel or aircraft
requires knowledge on the part of the must carry the contraband. It is not
carrier-owner or his agent of the likewise essential that the vessel or
unlawful act. A prima facie presumption aircraft must come from a foreign
shall exist against the vessel, vehicle or country.
aircraft under any of the following
circumstances:
Commissioner of Customs vs.
1. If the conveyance has been CTA and Jose Pascual
used for smuggling at least twice 138 SCRA 581
before;
The Supreme Court ruled that the
2. If the owner is not in the forfeiture of Pascual’s vessel used in
business for which the conveyance the illegal importation of untaxed
is generally used; and, cigarettes is justified.
4. undervaluation,
misclassification or misdeclaration;
and,
1. Officer shall write upon the certificate 1. Both cannot be availed of where
a description of the property upon amount involved is not more than
which levy is made. P100.
b. To be sold or destroyed –
depends upon the discretion Note: The Register of Deeds is duty bound to
of CIR transfer the title of property forfeited to the
government with our necessity of an order from
1. All other articles a competent court.
subject to exercise tax,
(wine, automobile, Other Administrative Remedies
mineral products,
manufactured oils, 1. Requiring filing of bonds – in the
miscellaneous products, following instances:
non-essential items a
petroleum products) a. Estate and donor’s tax
manufactured or
removed in violation of b. Excise taxes
the Tax Code.
2. Dies for printing or c. Exporter’s bond
making IR stamps, labels
and tags, in imitation of d. Manufacturer’s and importer’s
or purport to be lawful bond
stamps, labels or tags.
2. Requiring proof of filing income tax
returns
1. Where to be sold:
Before a license to engage in trade,
a. Public sale: provided, business or occupation or to practice a
there is notice of not less than profession can be issued.
20 days.
3. Giving reward to informers – Sum
b. Private sale: provided, it is equivalent to 10% of revenues,
with the approval of the surcharges or fees recovered and/or
fine or penalty imposed and collected
Secretary of Finance.
or P1, 000,000.00 per case, whichever
is lower.
1. Right of Redemption:
4. Imposition of surcharge and
a. Personal entitled –
interest.
taxpayer or anyone for him
5. Making arrest, search and seizure
b. Time to redeem – with in
one (1) year from forfeiture
Limited to violations of any penal law
or regulation administered by the BIR,
c. Amount to be paid – full
committed with in the view of the
amount of the taxes and
Internal Revenue Officer or EE.
penalties, plus interest and
cost of the sale
6. Deportation in case of aliens – on
the following grounds
d. To whom paid –
Commissioner or the Revenue
a. Knowingly and fraudulently
Collection Officer
evades payment of IR taxes.
b. Willfully refuses to pay such tax
and its accessory penalties, after 2. Conducted by Legal Officer of BIR
decision on his tax liability shall
have become final and executory. 3. Must be with the approval of the
CIR, in case of action, for recovery of
7. Inspection of books taxes, or enforcement of a fine, penalty
or forfeiture.
Books of accounts and other
accounting records of taxpayer must
be preserved, generally within three 1. Civil Action
years after date the tax return was due
or was filed whichever is later. Actions instituted by the government
to collect internal revenue taxes in
8. Use of National Tax Register regular courts (RTC or MTCs,
depending on the amount involved)
9. Obtaining information on tax
liability of any person When assessment made has become
final and executory for failure or
taxpayer to:
10. Inventory – Taking of stock-in-trade
and making surveillance. a. Dispute same by filing protest
with CIR
11. Prescribing presumptive gross sales
or receipt: b. Appeal adverse decision of CIR
to CTA
b. Any taxpayer who filed Does not exonerate taxpayer his civil
application for compromise by liability to pay the tax due. Thus, the
reasons of financial incapacity his government may still collect the tax in the same
tax liability. action.
Reason: Tax is an obligation, does not arise
14. Registration of Taxpayers.
from a criminal act.
Judicial Remedies
Effect of Satisfaction of Tax Liability on
Criminal Liability
Civil and Criminal Actions:
Will not operate to extinguish
1. Brought in the name of the
taxpayer’s criminal liability since the duty to pay
Government of the Philippines.
the tax is imposed by statute, independent of 3. In computing the prescriptive period
any attempt on past of taxpayers to evade for assessment, the latter is deemed
payment. made when notice to this effect is
released, mailed or sent by the
This is true in case the criminal action is Commissioner to the correct address of
based on the act to taxpayer of filing a false and the taxpayer. However, the law does
fraudulent tax return and failure to pay the tax. not require that the demand/notice be
received within the prescriptive
Note: The satisfaction of civil liability is not one period. (Basilan Estates, Inc. vs.
of the grounds for the extinction of criminal Commissioner 21, SCRA 17; Republic vs.
action. CA April 30, 1987)
Nature of Fraud:
1. A return filed before the last day
prescribed by law for the filing thereof
a. Fraud is never presumed and
shall be considered as filed on such last
the circumstances consisting it
day.
must be alleged and proved to
exist by clear & convincing
2. In case a return is substantially
evidence (Republic vs. Keir, Sept.
amended, the government right to
30, 1966)
assess the tax shall commence from
the filing of the amended return (CIR vs.
b. The fraud contemplated by law
Phoenix, May 20, 1965; Kei & Co. vs.
is actual and not constructive. It
Collector, 4 SCRA 872)
must amount to intentional
wrongdoing with the sole object of
avoiding the tax. A mere mistake
is not a fraudulent intent. (Aznar
case, Aug. 23, 1974) 1. Where the commissioner and the
taxpayer, before the expiration of the
c. A fraud assessment which has three (3) year period of limitation have
become final and executory, the agreed in writing to the extension of
fact of fraud shall be judicially said period.
taken cognizance of in the civil or
criminal action for the collection Note: Limitations:
thereof. (Sec. 222 paragraph (a))
a. The agreement extending the
period of prescription should be in
Fraud may be established by the writing and duly signed by the
following : (Badges of Fraud) taxpayer and the commissioner.
2. his authorized
\
representative
3. Member of his
household with sufficient
discretion and no
property could be
located.
Nota Bene: