SHELL STOPS OIL IMPORTS / PALACE TO SHELL: ACCEPT TAX DEAL
MANILA, FEBRUARY 21, 2010 (STAR) By Donnabelle Gatdula - Pilipinas Shell Petroleum Corp. has suspended all its importations following the Court of Tax Appeals’ (CTA) rejection of its petition for an extension of the temporary restraining order on the seizure of its imports by the Bureau of Customs.Roberto Kanapi, Shell spokesman, said they decided to temporarily stop their importation beginning Feb. 9 because “the BOC threat of seizure still remains.”
The BOC wanted to seize shipments of Shell to cover the oil firm’s reported P7.3 billion in back taxes for catalytic crack gasoline (CCG) imports.
Shell contested the BOC action, saying CCG is not a finished product but a raw material for unleaded gasoline production.
Even before the expiration of the TRO, Batangas Customs Collector Juan Tan – invoking section 1508 of the Tariff Code – attempted to seize shipments of crude, raw materials and other fuel products that were already tax paid and in the possession of Shell.
Tan’s action prompted Shell to seek help from the Batangas regional trial court, which issued a TRO on Feb. 10 prohibiting the BOC from entering Shell’s refinery “to hold, seize, confiscate and forcibly take possession” of Shell’s tax paid imported shipments. The TRO does not cover incoming imports.
Shell has also filed a motion for reconsideration with the CTA, seeking permission to resume its importations without the threat of its shipment being seized by Customs, while the case is being heard in the Court.
“We continue to exhaust all available legal remedies in order to prevent our property from being seized and avert any supply problems,” Kanapi said.
Shell currently accounts for 30 percent of the Philippine market.
The domestic storage facilities of its competitors are limited, which means they will not have enough stocks to satisfy the demand in case Shell is forced to stop operations.
“If seizures occur, Shell will have no raw materials to run the refinery and no products to sell. We do not want this to happen but for purposes of transparency, we have to let the public and government know the consequences of the BOC’s arbitrary action,” Kanapi added.
Palace to Shell: Accept tax deal By Marvin Sy (The Philippine Star) Updated February 21, 2010 12:00 AM
MANILA, Philippines - Malacañang has urged Pilipinas Shell Petroleum Corp. to accept the compromise proposed by the Department of Finance (DOF) to resolve its row with the Bureau of Customs (BOC) on the issue of its supposed arrears of P7.3 billion in back taxes in order to ensure the continuity of its operations.
Deputy presidential spokesman Ricardo Saludo, in an interview over Radyo ng Bayan, said that Shell and DOF officials had discussed the issue and it was up to the oil firm to act on the proposed compromise agreement.
The compromise involves having Shell set aside the P7.3 billion in an escrow account while the case is being heard by the courts.
If Shell wins the case, then the money would promptly revert to them.
“It is important that our compromise with Shell moves forward. If the money is set aside, then Shell can continue importing and our oil supply would not be affected,” Saludo said.
Shell has stated that it has stopped all of its importations after failing to secure an extension of a temporary restraining order from the courts to stop the BOC from seizing its imports.
The BOC is intent on seizing all of the imports of Shell to cover the P7.3 billion in excise taxes that the oil firm supposedly owes the government.
According to BOC, Shell’s importation of catalytic crack gasoline was not exempted from the excise tax because these were considered as finished unleaded gasoline.
But Shell contested this claim, saying that the imports were raw materials for the production of unleaded gasoline and thus were exempted from the excise tax .
Chief News Editor: Sol Jose Vanzi
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