Davies THE GOVERNMENT has made provisions to protect itself against revenue loss or chaos in the transitional period of the new Customs Act amendments.
Dr. Omar Davies, Minister of Finance and Planning, says the Bill amending the Customs Act empowers him to issue orders suspending the operation of any provision of the schedule, in relation to any category of goods for such period, and to specify the value and category of the goods and how their valuation will be determined.
Dr. Davies said that in addition, the World Trade Organisation's agreement on customs valuation allows developing countries which currently value goods on the basis of officially established minimum values for example in terms of the local valuation of used cars, to make a reservation to enable them to retain those values, on a limited and conditional basis, under terms and conditions agreed to by member states.
He said that the Government had already applied to the WTO for the right to make a reservation to retain such values on a limited and conditional basis, under such terms and conditions as are necessary, in addition to the clause empowering him to suspend the provisions of the Bill.
"Whilst the amendments may seem to be opening up importation, we have put in an application where we have belts and braces and, therefore, the transition is going to be orderly and will not jeopardise the revenue. It will allow us time to assess what the impact will be," Dr. Davies said.
He was closing the debate on the Bill amending the Customs Act to bring it in line with WTO requirements, on Tuesday in the House of Representatives.
Chaos
Dr. Davies was responding to concerns raised by Audley Shaw and Karl Samuda, JLP spokesmen in the House of Representatives, on the dangers of revenue reductions and chaos when implementing the changes in the Act.
The primary purpose of the Bill is to replace the current provisions under the Customs Act for valuation of goods for custom duties assessment purposes, with new provisions for customs valuations that are more appropriate to the new world economy.
The new provisions are based on a system of valuations promulgated under the customs valuation agreement of the WTO. Signatories to the WTO are required to apply them to imported goods, as the basis for charging customs duties ad valorem.
Jamaica is a signatory to the WTO agreement. The provisions are also agreed to by CARICOM and should be the basis of evaluation for importation of goods under the CARICOM Single Market and Economy.
Dr. Davies explained that under the current Brussels Definition of Value(BDV) system operating in local Customs, value for customs purposes of imported goods must conform to the price which the imported goods would fetch at the time that they are imported. The WTO valuation code, he said, creates a fairer, more uniform and neutral system which conforms with commercial reality and is based on prices actually paid or payable for goods.
But Mr. Shaw warned that the complexity of the Bill could make it difficult to enforce. He urged the minister to ensure that customs brokers are properly acquainted with the details and the public educated about the provisions.
Mr. Samuda predicted that the immediate impact of the changes would be a decline in customs revenues badly needed by the Government.
He said that in order to ensure that the provisions are not negatively exploited, the minister must send a clear message to importers that he would not tolerate breaches nor seek to cover up the misdeeds of people in "in high places." He said the provisions should apply equally to the rich and the poor.
