Finance Secretary Carlos Dominguez III has commended the Bureau of Customs (BOC) for its upcoming collection of P3.49 billion in excise and value-added taxes (VAT) on the alkylate importations of Pilipinas Shell Petroleum Corp. (PSPC) from 2014 t0 2020.

“Congratulations on collecting the tax on the alkylate imports. Even though it’s under protest, I think it’s a real move forward. Thank you,” Dominguez told Customs Commissioner Rey Leonardo Guerrero during a recent executive committee (Execom) meeting of the Department of Finance (DOF).

PSPC has agreed to pay the P3,491,629,824 in taxes on its past alkylate importations in two installments, but “under protest” as its case is still pending with the courts.

In a letter recently sent to PSPC, Guerrero said the BOC was recognizing the oil firm’s intent to pay the back taxes and directed it to submit its first payment on or before Dec. 27 this year.

Guerrero made it clear in his letter to PSPC President-CEO Lorelei Osial that the possible suspension of the oil firm’s accreditation in case it fails to pay the taxes “was not whimsically raised nor is the same a threat, but rather a proper recourse of the Bureau pursuant to existing rules and regulations and in view of the dissolution by the Supreme Court (SC) of the Temporary Restraining Order (TRO) previously issued” on the government’s demand for payment.

Dominguez said during the Execom meeting that the BOC’s move to demand tax payments on Shell’s alkylate imports “levels the playing field” as other oil companies have been paying the same on their shipments of the product.

The SC lifted the TRO that barred the government from collecting taxes on Shell’s alkylate imports in March.

The high court also remanded the case to the Court of Tax Appeals (CTA), where PSPC has filed a motion to pursue its previous TRO application to stop the government from collecting taxes on its alkylate shipments.

“In the event of default for the payment as agreed upon, the suspension of the accreditation of PSPC shall be forthwith imposed subject to existing rules and regulations, and without prejudice to any other available administrative and judicial remedies which the BOC may exercise,” Guerrero said in his letter.

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