BPK audits customs office over possible irregularities

BPK audits customs office over possible irregularities

Rendi A. Witular, The Jakarta Post, Jakarta

The Supreme Audit Agency (BPK) will conduct an investigative
audit of import duties collected by the Directorate General of
Customs and Excise after discovering suspected irregularities
during an earlier audit.

The deputy chairman of the BPK, Bambang Wahyudi, said the
agency had found "indications of irregularities" in the
collection of import duties during a routine audit of the
directorate.

"This is a special audit, not a routine one. We are focusing
on the collection of import duties to help maximize state revenue
and prevent corruption," said Bambang.

The results of the investigative audit will be reported to the
House of Representatives at the end of this year, he said.

However, the directorate denied it was the subject of a
special audit.

"As far as I know, there is currently no special audit by the
BPK here. If there is (an audit), I think it is just a routine
one, which includes among other things auditing import duties,"
the directorate's spokesman, Susiwijono, said.

The customs directorate has been criticized for years for
failing to curb collusion between the directorate's officials and
smugglers and dishonest importers, which has caused the
government to suffer massive losses.

While smugglers pay no import duties, many importers
undervalue the goods they are importing to cut their duty
payments.

Officials from the directorate admitted that in 2001 and 2002
alone, thus undervaluation caused the government to lose about Rp
17 trillion (US$2 billion) in potential revenue.

The directorate has drawn fire from many parties, including
the government, for its failure to meet import duty targets
contained in the state budget, despite increases in the country's
imports.

In 2002, for example, the directorate collected Rp 10.6
trillion ($1.2 billion) in import duties, compared to the budget
target of Rp 11.8 trillion. This despite a 4 percent increase in
import volume to $31.2 billion that year.