Two weeks ago on 7News - you heard the exchange between a man bringing a vehicle through the northern border and a customs brother - who makes arrangements for reduced customs duties - and what is listed as a "miscellaneous payment".
Tonight, Jules Vasquez looks deeper at those payments which are listed as miscellaneous but add up to more than what even the government collects on duty.
Those in the car trade call it "the bite" - and some importers agreed to share screenshots of how it was broken down for them.
Jules Vasquez had a look:
This is the standard setup: car importers get a text like this one with a breakdown of what they are supposed to pay - and the account number for the select brokerage with the customs connect.
The number at the top is the duty they will pay, the three or four lines below that are various brokerage fees and service charges - and the last line, that's the bite - allegedly for the customs officers, and the brokerage consultants who facilitate the connection.
This was a secret recording of a conversation between a car importer and an employee of the brokerage:
Voice of: Car Importer
"You don't have to call the name, right? I am not putting you on the spot. But the four thousand go to somebody, right? Well, not to one person, but it split up. The additional money who does it go to."
Voice of: Broker
"To the person that deals with it. That deals..."
Voice of Car Dealer
"That deals with it right?"
Voice of: Broker
"Exactly."
And that bite for the so-called "person that deals with it" is routinely more than double what the government collects - in this case the bite of $4,000 is 230%, almost two and a half times what the government collected- which actually worked out to a mere $1,747.81. This for a 23 year old GMC Hummer.
And there it is, the bank payment to the same brokerage for the full amount 6.092 dollars. 4 grand in bite, 1,750 in tax revenue to the public purse.
In the case of this 2015 Suburban, the duty was estimated at 3,864 and the bite? $6,500 dollars. That's 168% more than government's revenue take - more than one and a half times.
For this 2024 Prius, the duty was estimated at 5,527 dollars and the bite? $6,500 dollars - a charitable 118% bite.
On this one, the importer got what you might think was a sweet deal- he was told the original duty would be $17,159.59 duty - but because he used the services of the special broker - that duty went down to $3529.90 - with a flat $6,000 dollar bite - working out to a grand total of $9,799.90. The bite in this case is 170% more than government's take - but the importer is also made to feel he got away because he left paying just over half of what they said the duty would be.
And for this 2010 4Runner, a 15 year old vehicle, the duty 2380.16, and the bite would be 170%, 4,000 dollars. It might seem crazy that the bite is constantly more than twice what government collects, but, like the man said, this is how it works:
Voice of: Broker
"Me and you know how the thing works bally."
When we asked the Prime Minister about this system of alleged customs kickbacks - he said he was just hearing about it - which - based on our knowledge of the operators involved - can hardly be plausible. He urged the dealers to make police reports.
