DOJ Opinion No. 057, s. 1987

DOJ OPINION NO. 057 , s. 1987 June 5, 1987 The Acting Commissioner Bureau of Customs Manila Sir : This has reference to your request for opinion on the legality of the petition of Polyphosphates, Inc. ("PPI") that it be allowed to import its annual liquid caustic requirements of 14,300 MT dry basis at 50% ad valorem and not the specific tax rate of P2.35 per kilogram dry basis. dctai You state that under Executive Order No. 49 which was promulgated October 1, 1986, the tariff rate for, among others, liquid caustic soda importations was increased from 30% to 50% ad valorem or P2.35 per kgm. on a dry basis; that PPI, a Board of Investments (BOI) registered firm engaged in the manufacture of major raw materials for synthetic detergent bar was granted by said board authority to import its caustic soda requirements for the reasons that the local producer, Mabuhay Vinyl Corporation, is unable to fulfill PPI's needs; that under the present procedure of the assessment group in the Bureau of Customs to impose whatever rate would result in higher tariff revenues for the government, PPI's caustic soda importations would be subject to a 173% tariff rate compared to the nominal 50% rate; that the ABOI believes that the 50% ad valorem rate should be imposed in the instant case, provided that the imported chemicals will be for the exclusive used of PPI for the manufacture of raw materials for detergent bars, since it will enable the local detergent industry to maintain the selling price of detergents, and yet will not defeat the purpose of tariff protection for the local producer of liquid caustic soda; and that Mabuhay Vinyl Corporation has endorsed PPI's petition. You further state that you are inclined to act favorably on PPI's petition for the reason that the revenue goals of the Bureau of Customs should not be realized at the expense of the interests of other government agencies, but nonetheless, would like to seek the view of this Department as to whether the Bureau of Customs has authority to impose the requested tariff rate of 50%. The pertinent provision of Executive Order No. 49 provides that the tariff rate for liquid caustic soda is either "ad. val. 50% or kg. P2.35 on dry basis". While the statute provides two options as to the rate to be imposed for caustic soda importations, it does not prescribe guidelines in the determination of the applicable in each case. It is thus believed that the law vests upon the Bureau of Customs the discretion to determine the applicable tariff rate for the questioned importations. Expressed otherwise, customs officials are empowered by law to decide on what rate is just and proper under the attendant circumstances (Lamb vs. Phipps, 22 Phil. 488) and whichever way they would exercise their discretion on the rate to impose, they are still right. (Asuncion vs. De Yriarte, 28 Phil. 71) prcd Thus, in the absence of a showing of any abuse of authority on the part of the Bureau of Customs in deciding on the issue of the applicable tariff rate in the instant case, such administrative determination is final. (See Ang Eng Chong vs. Collector of Customs, 23 Phil. 614) Pertinent is the ruling in Manuel vs. Villena (37 SCRA 745) that ". . . courts, as a rule, refuse to interfere with proceedings undertaken by administrative bodies for officials in the exercise of administrative functions. This is so because such bodies are generally better equipped technically to decide administrative questions and that non-legal factors, such as government policy on the matter, are usually involved in the decisions." (See also Del mar vs. Philippine Veteran Administration, 51 SCRA 340) Please be guided accordingly. Very truly yours, (SGD.) SEDFREY A. ORDOEZ Secretary of Justice