The government may have lost P5 million this year owing to smuggling and undervaluation of flour imports, whose entry may also put at risk public health, a source at the Bureau of Customs said.
Undervaluation may have involved flour imported from the Philippines’ major suppliers: India, China and Japan.
Indian flour, with a transaction value of $272 a metric ton free onboard (FOB), was declared $140; Chinese flour came in at $200. Container freight from China and India is around $22 a metric ton.
A recorded transaction value of flour imports from Japan worth $241 entered the port with a lower value of around $157 for every metric ton.
The Philippines imposes a 7-percent tariff on flour imports.
The source said some of the flour imports risk the health of the consuming public when these flours are declared industrial to be used for making plywood and carton-box manufacturers but are instead diverted into manufacturing bread, pastries and noodles.
Industrial flour is unsanitary for food consumption.
The Philippines has imported about 2,168 MT of flour from Japan this year, 2,084.3 MT from India and 979.6 MT from China.
China was the country’s biggest supplier of flour last year with a recorded volume of 2,792.8 MT.
Data from the National Statistics Office show that 5,616 MT of flour were imported in 2003. This year, imports in the first eight months already reached 6,964 MT, thus posting an increase of 1,348 MT.
The source also said the government should restore tariffs to levels prevailing before the enforcement of the Tariff Reform Program in the 1980s as a means to raise revenues and protect less developed domestic industries.
Besides the three major flour suppliers, the Philippines also imports flour from Vietnam, Singapore, Belgium and Indonesia.