60% of import invoices underpriced

60% of import invoices underpriced

JAKARTA (JP): A high proportion of import invoices are
underpriced, due to the lack of control from the customs and
excise authority, according to the Indonesian Importers
Association (Ginsi).

The association's chairman Amirudin Saud said that
underpricing had attributed to the significant drop in the
government's receipts from import duties.

"About 60 percent of the country's import goods are
underpriced," he told reporters at a media briefing.

According to him, last year's realized import excise amounted
only Rp 6.4 trillion (US$570 million), only about a half of the
its existing potential.

Underpricing of the import invoices was rampant due to
weaknesses in the post-shipment inspections carried out by the
customs and excise authority, he added.

In 1997, the customs office operated the post-shipment
inspection system for imports, after regaining its inspection
rights that were scrapped by the government in 1985.

Between 1985 and 1997, the inspection rights were given to
Geneva-based Societe Generale de Surveillance (SGS), which
conducted pre-shipment inspections of imports.

Amirudin said that underpricing could not be stopped as long
as the government continued to implement post-shipment
inspection.

"The government should re-impose pre-shipment inspection to
solve the problem", he added.

He also said that if the government implemented pre-shipment
inspections, this year's revenue from excise duties could exceed
its target of Rp 27 trillion.

"The government revenues from the import duties could reach
about Rp 35 trillion this year," he said.

He added that pre-shipment inspection would also help attract
foreign investors to invest their funds in the country, as it
would give them more certainty in their business activities.

"The system was faster and more efficient when it was operated
by SGS," he said, but he did not elaborate.(05)