House panel seeks carmakers’ tax records

The House subcommittee on Customs tariff and duties has sought the tax records of car and truck assemblers to verify reports that they have been cheating in their tax payments.

Rep. Jesli Lapus, subcommittee chairman, said yesterday his panel has given the assemblers until next week to present their tax records.

He said the subcommittee will resume its inquiry after the two-week Halloween recess of Congress which begins tomorrow.

The Lapus panel is looking into the tax compliance of car and truck makers and importers of used vehicles.

The subcommittee has received information that some assemblers were bringing in "4 x 2" units which they then convert into "4 x 4" sport utility vehicles.

The practice is aimed at evading the higher tax for 4x4s.

"We would like to determine if that is legal or not, if they are not required to pay additional taxes and duties once they convert their units into 4 x 4 SUVs," Lapus said.

The panel also received reports that other car and truck makers bringing in completely built units (CBUs) declare these as knocked-down vehicles for which the tax is significantly lower.

So it would be fair to all concerned, the subcommittee has launched an inquiry into whether importers based in Subic and other special economic zones are paying the right amount of taxes.

Subic importers and auctioneers, on one hand, and car and truck assemblers, on the other, are engaged in a word war, accusing each other of cheating the government of taxes.

Assemblers want the imports and auctions stopped, claiming these have eaten into their markets.

Importers and auctioneers have denied the accusation, asking their detractors to give the buying public a choice between costly, brand-new vehicles, and cheap second-hand units. – Jess Diaz