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Is Your Importation Considered as De Minimis Importations and No Longer Subject to Duties and Taxes?

If you’re a business owner looking for ways to minimize importing cost, then you should familiarize yourself with one of the salient features Customs Modernization and Tariff Act (CMTA) which was implemented October last year.

Under Customs Administrative order no. 02-2016, De minimis provision of the CMTA is implemented which states that imported goods in the Philippines with a freight on board (FOB) or free carrier (FCA) value of P10,000 and below are no longer subject to duties and taxes.

This said provision aims and targets to 1) minimize the importation costs and customs administration costs of clearing such importations, without compromising customs border enforcement patrol and; 2) adapt the growing trend toward trade liberalization and facilitation and harmonize the country’s customs laws with different applicable international trade agreements.

Here are some facts one needs to know in order to assess whether your importation might be free of duty and taxes.

a.) Importations brought in by passengers or sent thru balikbayan boxes may be considered as de minimis when they have complied the parameters of Conditionally Free Importations.

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b.) Importations under such, is still needed to be lodged and processed.

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c.) Random and non-intrusive examination will be conducted but customs examiners may also physically examine and inspect the goods in order to prevent the entry of contraband goods.

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d.) Tobacco, wines and spirits are still subject to excise tax even if its value falls within the de minimis value.

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e.) Tobacco and liquor products exceeding the allowable limits carried by passengers but within the limits of the de minimis value are also excluded.

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f.) Shipments which are declared as “without commercial value” or “of no commercial value” are excluded from immediate release as de minimis importations.

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g.) Goods that needs import permits, licenses, requirements, and clearance are still needed to be complied with unless such is for personal use.

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These are only several and important facts about the de minimis provision. The said provision will also be reviewed every 3 years and amended or revised, if necessary. Your shipment might qualify in this provision. For assistance, feel free to contact Excelsior Customs Brokerage where peace of mind of clients is our service.