The Jamaica Customs Agency takes note of the Sunday Observer article dated October 30, 2016 which raised concerns about the Customs Administrative Fee (CAF) and the Automated System for Customs Data, ASYCUDA World, which had incomplete and in some instances incorrect information.
The article made note of the approved Cabinet Decision #29/13 which was implemented by the Agency. These included revenue enhancement and trade facilitation measures, including the reduction of the cap on Examination CAF (eCAF) to $20,000.
Contrary to the Observer’s report, the Commissioner of Customs communicated the Agency’s responses to the Financial Secretary by letter dated November 18th, 2015 and by email - December 4th, 2015. The matter was also dealt with between the Commissioner and the Financial Secretary in a meeting on December 3rd, 2015. On December 7th, 2015, the Agency implemented corrective measures which remain in effect.
The JCA’s revenue generating capacity is a direct function of the size of the tax base – the CIF value of imports (which is impacted by trade volumes and rate of exchange), tax measures introduced by the Government of Jamaica, and compliance initiatives by the JCA.
As at September 30, 2016, the total net revenue generated by the JCA was $93.364B or 3.2 per cent or $2.898B above the target of $90.466B. This revenue outturn was $13.727B or 17 per cent above the fiscal year’s revenue of $79.637B.
The revenue from General Consumption Tax (GCT) accounted for 39 per cent of the year-to-date net revenue, while Special Consumption Tax (SCT) and Import Duty (ID) accounted for 25 per cent ($23.677B/$93.364B) and 19 per cent ($17.375B/$93.364B) respectively.
The Customs Administration Fee (CAF) accounted for only 7 per cent ($6.653B/93.364B) of the year-to-date net revenue. In keeping with the Government’s thrust to incentivise growth enhancing sectors of the economy, CAF revenue has been reduced by discounted CAF rates to sectors such as manufacturing, bauxite and petroleum. As such, CAF revenue’s contribution to the total Agency revenue has declined from 9 per cent in FY13/14 to 8 per cent in FY14/15 with a further decline to 7 per cent in both FY15/16 and FY16/17. The effective CAF rate is steadily being reduced to stimulate and sustain economic growth.
Of the total cost to move cargo from the Port to Free Zone as cited by the Observer, it must be emphasised that only approximately 46 per cent would accrue to the Jamaica Customs Agency, the remainder being port related fees.
As it relates to the implementation of the Automated System for Customs Data, ASYCUDA, within the JCA, Jamaica is one of 90 countries world-wide using the ASYCUDA System. This includes all CARICOM member states, the latest being Antigua which has the Customs Automated System (CASE), which also preceded the implementation of ASYCUDA World in Jamaica. Panama is the latest Customs Administration in the region to express an interest in the implementation and use of ASYCUDA. Of the 90 countries making use of the varying versions, currently 72 countries use the ASYCUDA World version as is the case in Jamaica.
The implementation of ASYCUDA World which resulted in revolutionised improvements in conducting business with Customs has been extremely successful to date. This is evidenced in the 2017 World Bank Doing Business Report:
“Both Grenada and Jamaica made significant upgrades to their electronic platforms, resulting in a substantial decrease in the time required for international trade processes. Their systems allow for the electronic submission of customs declarations and supporting trade documents. As a result, customs brokers no longer need to go to several customs clearance officers or government agencies to validate documents.”
This has resulted in a greater positive outlook for trading across borders in Jamaica. (Jamaica now ranks 67thcompared to 90th position when the ASYCUDA project commenced in 2014). The Agency supported by the multilaterals such as the International Monetary Fund (IMF) and World Bank foresees greater insights and improvement in Jamaica’s trade and economy that could be achieved with the expected integration of ASYCUDA World and PCS.
While three (3) agents of the Shipping Association have raised issues concerning the confidentiality of information in ASYCUDA, there has been no evidence to substantiate any breaches to-date. That is, no entity has been able to provide evidence of its information being seen or used by unauthorised persons.
The system mandates the agent of a ship or aircraft to authorise access to Co-loaders, Non-Vessel Operating Common Carriers (NVOCCs), Freight Forwarders and sub-agents using the entities Taxpayer Registration Number (TRN). The approval permits these entities to access pertinent information only pertaining to their cargo for further processing at the varying levels of the logistics and supply chain. Formal declarations can only then be submitted to the Agency for subsequent clearance of cargo.
The United Nations Conference on Trade and Development (UNCTAD) has confirmed that no other country has had issues or claims regarding information being seen by competitors. It is also important to note that many of the shipping lines, including the major ones operating in these countries, are the same operating in Jamaica. Hence, any issue or claim regarding information being viewable by competitors would be unprecedented to UNCTAD in its implementation of the ASYCUDA System over the last 30 years.
The Jamaica Customs Agency wishes to take this opportunity to reassure its valid clients and stakeholders of its commitment to fostering an environment for a more efficient and transparent means of doing business.