THE Philippine Retailers Association (PRA) said it supports the gradual abolition of the de minimis rule for imports, adding that the lowering the threshold for taxing such shipments would be a good start.
It said the outright abolition of the de minimis rule could be “too aggressive” a move for consumers.
Retailers have been complaining about competition from overseas online sellers, whose shipments are untaxed if their value falls below P10,000.
“Considering the current importation climate in the Philippines, removal may be too aggressive of a step,” the PRA said in a letter to the Bureau of Customs (BoC) dated May 6.
The PRA said that the government could explore alternatives like lowering the threshold, limiting the availment of the de minimis tax-free privilege to once per month per consumer, and applying tax if the goods are for commercial resale and not personal use.
PRA President Roberto S. Claudio said that the group will continue pushing for the eventual removal of the de minimis rule.
“The European Union has already completely abolished de minimis; in the US, they also eliminated it,” Mr. Claudio said by telephone.
“If we don’t abolish it, we could just gradually lower the threshold. We are not giving a figure because we want the BoC to determine that,” he added.
The P10,000 de minimis rule was implemented through Customs Administrative Order (CAO) 2-2016. The exemptions are designed to ease the administrative burdens of such imports.
“The reason they implemented the de minimis rule is to ease the clearance of personal effects, so there will be fewer administrative steps involved in bringing in small and insignificant products,” he said.
“But with the advent of e-commerce, items come by piece; they don’t come in bulk shipments. So this leads to a tremendous loss of government revenue,” he added.
The PRA has yet to receive a response from the BoC, but noted that Finance Secretary Ralph G. Rector has said that the CAO is currently being reviewed. — Justine Irish D. Tabile
