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Shell denies swindling gov’t of excise taxes

“Shell has paid all the right taxes and strongly denies having engaged in any fraudulent activity, especially smuggling, as this is very much against its business principles…”

Posted at 08/22/2011 8:36 PM

MANILA, Philippines – Pilipinas Shell Petroleum Corp. denied it has defrauded the government of billions of pesos of excise taxes for importing a blending component for unleaded gasoline.

In a statement, the oil importer said the product in question, alkalyte, is not a finished product and therefore not subject to an excise tax.

“However, when the alkylate is further processed into finished unleaded gasoline product that is fit and ready for consumption, the finished product is subject to the payment of excise taxes before the same is released from Shell’s refinery. In other words, no excise tax is lost on the alkylate imports in question,” it said.

Zambales Rep. Mitos Magsaysay has made a case with the issue to call for the resignation of Customs Commissioner Angelito Alvarez.

In a statement today, she said: “It would seem that Alvarez wants to add another nail to his coffin with the emergence of new evidence of his incompetence in his failure to act on the allegedly misdeclared imports of Pilipinas Shell worth over P1.5 billion in excise taxes and Value Added Tax.”

“Shell, however, pointed out that no less than the Bureau of Internal Revenue has issued an “Authority to Release Imported Goods (ATRIG)” for all the alkylate importations.

“No excise taxes were paid on the shipments because they were all covered by the corresponding ATRIGs issued by the BIR, which recognized the same to be raw materials and/or blending components,” it said.

“Shell has paid all the right taxes and strongly denies having engaged in any fraudulent activity, especially smuggling, as this is very much against its business principles,” it further stated.


Comment by John Donovan

Great play was made of Shell’s claimed business principles on successive Form 20-F Declarations filed with the U.S. Securities & Exchange Commission, which later turned out to contain false (inflated) hydrocarbon reserves figures. The repeated reference to Shell’s business principles pledging honesty, integrity and transparency, was designed to bolster confidence in the false information. Shell was found guilty of securities fraud and fooling the markets. So although I have no idea whether the allegations in this case have substance, I would not be in the least reassured by Shell making reference to its business principles.

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