Question & AnswerQ&A (Republic Act No. 8181)
The dutiable value of an imported article subject to an ad valorem rate of duty shall be the transaction value, which is the price actually paid or payable for the goods when sold for export to the Philippines, with certain allowable adjustments.
Costs to be added include commissions and brokerage fees (except buying commissions), cost of containers, packing costs, value of materials or components incorporated, royalties and license fees, parts of proceeds from resale accruing to the seller, transport costs, loading/unloading and handling charges, and insurance costs.
The Commissioner may require the importer to provide further explanation and additional documents, and if doubt remains, proceed with alternative valuation methods such as the transaction value of identical goods, similar goods, or computed value.
Reasonable doubt refers to any condition creating probable cause for the Commissioner of Customs to believe the declared invoice value is inaccurate, including conditional pricing, buyer-seller relationship influencing price, or when the price depends on extraneous considerations or future proceeds accruing to the seller.
Persons are related if they are officers or directors of each other's businesses, business partners, employer and employee, own or control five percent or more of stock in both entities, have direct or indirect control relationships, or are members of the same family including spouses and lineal descendants.
'Identical goods' are goods the same in all respects including physical characteristics, quality, and reputation; minor differences in appearance do not preclude goods from being identical.
'Similar goods' are goods not identical but having like characteristics and components enabling them to perform the same function and be commercially interchangeable; factors include quality, reputation, and trademark.
Until Congress authorizes the shift to transaction value before January 1, 2000, the dutiable value may be based on the export value in the principal export markets of the exporting country, subject to certain conditions and adjustments.
The importer may secure release upon filing a cash bond amounting to the duties and taxes due plus 25%, conditioned upon payment of customs duties and taxes. Goods prohibited by law shall never be released under bond.
The Secretary of Finance, upon the recommendation of the Commissioner of Customs, shall promulgate the necessary rules and regulations for effective implementation.
Importers or interested parties have 15 days from publication to file a protest, which the Commissioner of Customs must resolve within 15 days, either amending or retaining the value, and must publish the decision.
The Commissioner shall create bodies to receive and hear protests on published values, receive evidence, submit recommendations, and communicate final decisions, and review published values upon petition.
If the sale or price includes conditions such as price dependent upon purchase of other goods or partial proceeds from resale accruing to the seller, these considerations create reasonable doubt and may require adjustments or alternative valuation methods.