Arroyo set to sign EO curbing oil smuggling

By Lawrence Agcaoili - Manila Standard Today

President Gloria Macapagal Arroyo wants to put an end to rampant oil smuggling, especially in free ports and economic zones.

Finance Secretary Margarito Teves told reporters that Malacañang was set to issue an executive order that would help curb oil smuggling in economic zones, especially in Subic Bay Freeport.

Teves said under the proposed EO, the government would require locators in free ports and ecozones to submit their oil requirements.

The finance chief said the government would ask locators to get a permit from authorities, including the department and the Bureau of Customs, for any excess in their oil requirements.

Teves said EO was among the measures to be undertaken by the government to curb rampant smuggling that resulted in foregone revenues of as much as P65 billion a year.

“The government has been losing P64 billion to P65 billion yearly in potential revenues because of smuggling,” Teves said.

Teves on Aug. 15 signed a directive mandating the marking of imported kerosene and fuel oils that enter tax and duty-free to prevent unauthorized diversion to the domestic market.

“There are reliable reports that said tax and duty-free articles have subsequently entered the domestic market illegally without the payment of the proper duties and taxes, resulting in huge revenue losses to the government and to legitimate oil companies,” Teves said.

Customs imposes the mandatory marking of all kerosene subject to zero excise tax, and all diesel oil whose exemption from the payment of duties and taxes are claimed through the Subic free port, Clark special economic zone and Port of Batangas.