Car auctions in Subic generate P200 M in taxes

Government has collected P200 million in excise taxes and import duties from the importation of second-hand vehicles through the Subic Bay Freeport, and auctioneers are even more optimistic that the market would grow despite the current political crisis.

Unruffled by protests from local automotive manufacturers, auction operators said their auctions are generating huge revenues for the Bureau of Customs which they said collected a total of P196.3 million from last year up to October this year.

The BOC reported that collection from the auction industry is the second biggest recorded by the bureau and this is expected to go up further as the auctions become more popular.

According to JVMC, one of the three auction operators at Subic, there is no basis for the alarm raised by the Philippine Automotive Federation Inc. (PAFI) because all vehicles sold at the auctions complied with standard regulations of safety.

As soon as the vehicles arrive in Subic, JVMC chief executive officer Jaime Ngo said they have them completely checked to make sure that they abide by all safety measures. "It’s not true that these vehicles are imported duty-free. We pay all the appropriate tax and customs duty for each and every vehicle sold in the public market."

Because very few people can afford brand new vehicles and equipment, Ngo said the foreign consignees of the auction operators are optimistic about the Subic market. "They are not affected by the developing political crisis in Manila," he said.

According to Ngo, the consignees are so optimistic they are now planning to expand their operation to include other goods.

At present, the increasingly popular Subic auctions sell second-hand automobiles such as vans, luxury cars, sports vehicles, light and heavy industrial equipment and agricultural machinery.

According to Subic International representative William Ranaga, the auctions at Subic have grown exponentially such that Asia International Auctioneers, one of the operators at Subic, has been listed at the Guinness Book as the world’s largest single auctioneer.

"There was no objection when Ritchie Brothers, a multinational auction company was operating in Subic. It should be supported now because the auction houses are Filipino-owned and since it is so, money doesn’t leave the Philippines," Ranaga added.

AIA said local car manufacturers need not worry about the Subic auctions since they cater to different markets.

AIA operations manager Jenny Armamento said auction operators do not sell automobiles that are considered prohibited vehicles, covering mostly cars that are being assembled locally.

Armamento also said that not only Filipino buyers buy from the Subic auctions, but also groups and individuals from Australia, Thailand, Singapore, Cambodia, Vietnam and Indonesia.