‘Traders divert imported fish to evade VAT’

MANILA, Philippines — Unscrupulous fish importers are diverting frozen stocks of round scad (galunggong), bonito (tulingan) and mackerel (alumahan) to the wet markets to evade paying value added tax (VAT), the Department of Agriculture (DA) said yesterday.

Agriculture Secretary Francisco Tiu Laurel Jr. said that some “crafty” importers sold some of their frozen imported fish inventory to the wet markets, where the sale of marine products is exempt from VAT.

Tiu Laurel made the statement a few days after he ordered an impending import ban on the three fish species for most of the country’s canners, processors and institutional buyers, which include hotel and restaurants.

Canners are still allowed to import mackerel as long as they comply with the government’s import rules, including the additional requirement of including a proper label on the imported stocks, the agriculture chief said.

He explained that canners may import mackerel based on the total VAT-able volume of canned products they sold last year. He noted that he even allowed canners to import an additional 10 percent of the total canned mackerel they sold to serve as canners’ buffer stock.

The DA earlier pointed out that a crackdown on erring importers would help the government collect the right taxes. Furthermore, it would also “protect” local fishermen “from unfair trade practices that undermine their livelihood,” the DA added.

According to the DA’s estimates, roughly 100,000 metric tons of imported fish products, including round scad, are being diverted to wet markets each year.