By McPherse Thompson, Staff ReporterTHE new valuation system to be put in place at the Jamaica Customs Department will not result in any change to the current method used to determine the value of new motor vehicles imported into the island, the revenue agency confirmed earlier this week.
At the same time, a spokesman for the Ministry of Finance and Planning said the Government was still awaiting a response from the World Trade Organisation (WTO) on whether or not the country could continue to use the valuation method currently in place for used motor vehicles.
The new valuation system is contained in a Bill to amend the Customs Act, and approved by Parliament earlier this year, to bring it in line with WTO requirements. This will result in the implementation of the WTO Valuation Agreement, replacing the Brussels Definition of Value (BDV) currently operating in local customs.
Some Customs personnel have already undergone prescribed training for the new regime, but the Customs Department said it was awaiting instructions from the Ministry of Finance and Planning to begin implementation.
The Ministry spokesman said technical experts on the WTO have made recommendations to Finance and Planning Minister Dr. Omar Davies as it relates to the implementation of the new system, and that the Minister is expected to address the issue when he opens the 2001/2002 Budget Debate in Parliament next Wednesday.
However, the Customs Department said the WTO Valuation Agreement notwithstanding, the present valuation system used for new motor vehicles would continue to be determined by the transaction value, that is, the price actually paid or payable for the imported item when sold for export to the country importing it.
In response to the Financial Gleaner questions in February, the Customs Department had said that no decision was in place for the treatment of used motor vehicles as the Government was awaiting a decision from the WTO. It said special provisions were made available under the WTO Agreement for developing countries to retain the use of minimum values or reference pricing for a limited and transitional period under such terms and conditions agreed to by the WTO members.
"Jamaica has made such a request for used motor vehicles and is awaiting a determination," the Customs Department said. "If permission is given this would result in no change to the present system."
Under the WTO Agreement, six methods of valuation will be used, the primary one being transaction value. Other methods to be used will be the transaction value of identical goods, transaction value of similar goods, deductive value, computed value and fallback method, to be applied sequentially starting with the primary method. However, the computed value will not be applied in Jamaica until March 2003 under a concession available to developing countries.
Motor vehicle imports is a major source of revenue for Customs, which, according to consultants who carried out a study of the Department, collects import duties totalling just under $20 billion annually.
