Walker collecting billions more from importers
Published:Friday | July 16, 2010 | 12:00 AM
The Government's total tax take might be challenged by the ongoing recession, but the customs department is reporting robust growth in port collections, which it attributes to a clampdown on evasion.
Its fiscal first-quarter intake was just shy of J$3 billion above projections resulting, said Commissioner Danville Walker, from improvements to the revenue-collection system and accelerated sale of goods left on the wharves longer than 14 days, awaiting duty payment.
Walker has also got more aggressive about hauling before the courts those importers found trying to beat the system.
"The Customs Department has been tightening its procedures on the ports to minimise revenue leakage and also focusing on quality service delivery," he told the Financial Gleaner.
Having set a total revenue target of J$22.96 billion for the first quarter of the fiscal year, Customs collected J$25.94 billion - J$2.98 billion or 13 per cent more than it was aiming for.
This performance represented gross revenue growth of 37 per cent for the April to June quarter compared to the same period of the previous financial year.
"When compared with the same period last year, gross revenue collection increased by $6.925 billion or 37 per cent, tax revenue increased by $7.12 billion or 49 per cent and net revenue by $5.966 billion or 33 per cent," said Walker.
Customs duty accounts for about eight per cent of all taxes, while the more broader category of international trade taxes is more than 30 per cent of revenue.
The improvement, Walker pointed out, resulted from the tightening of collection procedures as well as the creation of incentives for importers who pay their duties promptly.
Court action
Those caught in breach of regulations are now being threatened with jail and court action.
"Whenever the persons deliberately seeking to evade customs duty are caught, it is now the policy of this department to seek to have them arrested and taken before the courts," the customs head said.
"We are no longer going to simply collect the additional duty (because) this is the only way that we will create an environment for growth; where legitimate business that pay taxes can compete and prosper".
The sale of goods left on the ports beyond the stipulated period, and for which the applicable duties have not been paid, is now being accelerated and is proving a robust business for the customs department.
Customs now plans to hold anauction every month instead of the customary yearly sales, Walker said.
A pre-inspection programme at Customs, which officials there said had boosted the duty payment compliance rate to 97 per cent, has been suspended for want of cameras, lighting and other requirements.
"The department is of the view that when cargo is inspected in the presence of importers or brokers it provides too many opportunities for corruption," Walker told the Financial Gleaner.
Under the pre-inspection pilot programme, goods are examined while the containers are being stripped.
"The department suspended the programme as sufficient safeguards were not put in place to protect the cargo from theft, and the department from accusations of theft," he said.
"No modern warehouse can operate without cameras, and no modern customs department can have officers and importers in dark warehouses inspecting cargo."
The pre-inspection programme will be reintroduced at all ports of entry when the kinks have been ironed out, Walker said.
Next year, the customs department will move towards becoming an executive agency of the Government, giving it greater management autonomy.
The change, Walker insists, will result in further increases in revenue collection, and greater protection of Jamaica's borders.
"The move to executive agency will enable us to deliver on our vision of a modern customs administration, delivering excellent service, fostering compliance and contributing to our national development and the protection of society," he said.
Jamaica has budgeted tax collections of J$287 billion in fiscal 2010-11, including J$23.5 billion of customs duties.