RMC No. 52-2010: Publishes the full text of Joint Order No. 1-2010 issued by the Secretary of Finance and Commissioners of the Bureau of Customs and BIR entitled “Valuation of Motor Vehicles”

Key points

1. Coverage. The Joint Order applies to all imported motor vehicles, whether or not subject to duties, VAT and excise tax. It covers brand new Completely Built Units allowed under CB Circular No. 92, Series of 1996, vehicles exempt from Executive Order 156 or imported under the no-dollar program, and duty or tax free vehicles later sold to non-exempt persons. It also covers importations under Section 105 of the Tariff and Customs Code.
2. Rates and valuation basis. Duty, excise tax and VAT rates and the exchange rate are those applicable at the time of filing of entry. The country of origin, read from the first digit of the VIN or chassis number, decides the book value used: AGMR for Japan, US Red Book, KARO Book for Europe, Korean Book, and Red Book Asia Pacific.com for China and Dubai. For brand-new vehicles not yet in a reference book, the invoice value is used, with tentative release under CMO No. 37-2001 and a written undertaking to submit to post-entry audit.
3. Personally-owned vehicles. The importer presents the Bill of Lading, Invoice or Deed of Sale, Packing List, ITR or Audited Financial Statement (for corporations), and an affidavit that the vehicle will not be sold or bartered within 3 years from importation, failing which the adjusted Excise Tax is paid. Appraisal is the higher of invoice or transaction value and book value, depreciation is 10% straight line per year but not over 50%, ATRIG is dispensed with, and 100% examination applies.
4. LTO annotation. The BOC asks the LTO to annotate the Certificate of Registration that the vehicle may not be sold or disposed of within three (3) years from importation without payment of the adjusted Excise Tax computed by the BIR.
5. Vehicles imported for sale. The importer presents the Bill of Lading, Invoice or Deed of Sale, Packing List and Manufacturer’s/Importer’s Selling Price. Release needs payment of ad valorem tax and an ATRIG from the BIR office with jurisdiction over the principal place of business. Every six months the BIR gives the BOC copies of the Manufacturer’s/Importer’s Sworn Statement, and amended statements go to the BOC within 5 days from filing.
6. Joint Committee. A Joint Committee of BOC and BIR personnel meets quarterly or as needed and reports to the Secretary of Finance, copy furnished the Presidential Adviser on Revenue Enhancement. Its valuations serve as the uniform basis for computing duties, VAT and Excise Tax on imported automobiles.

Who is affected

• Importers of motor vehicles for personal use or for sale
• Bureau of Customs and BIR personnel

Deadlines and effectivity

• Rates and exchange rate: as of the date of filing of entry
• No sale or barter of personally-owned vehicles within 3 years from importation
• Sworn Statements provided to the BOC every six months, amended ones within 5 days from filing
• Joint Committee meets quarterly or as needed