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Category: Pakistan Customs

  • Advance ruling for classification of goods implemented

    Advance ruling for classification of goods implemented

    ISLAMABAD: The law of advance ruling for classification of goods or determination of origin has been implemented through Finance Act, 2020 from July 01, 2020.

    The National Assembly has approved the law of advance ruling that was proposed through Finance Bill, 2020.

    According to explanation issued by PWC A F Ferguson Chartered Accountants, the concept of advance ruling presently there in the Customs Act, has been revamped.

    Previously, the mechanism is relevant only in respect of classification for assessment of duties on goods intended to be imported/ exported.

    Through the Finance Act 2020 the meaning and scope of advance ruling has been enhanced to include the determination of classification, origin, the applicability of particular relief/ exemption on goods and any other matter as Federal Board of Revenue (FBR) may specify.

    A new section 212B has been inserted to Customs Act, 1969 which stated:

    “212B. Advance Ruling –

    (1) An applicant desirous of Advance Ruling may make an application in such form and in such manner as may be prescribed under the rules, stating any of the questions as contained in sub-section (3) hereinafter on which the Advance Ruling is sought.

    (2) The question on which advance ruling is sought shall be in respect of.-

    (i) Classification of goods under the First Schedule to this Act;

    (ii) Determination of origin of the goods under the rules of origin notified for bilateral and multilateral agreements;

    (iii) Applicability of notification issued in respect of duties under this Act or any tax or duty chargeable under any other law for the time being in force in the same manner as duty of customs leviable under this Act; or

    (iv) Any other matter as the board [FBR] may specify by notification in the official Gazette.

    (3) The proceedings for issuance of advance ruling shall be completed within 90 days.

    (4) The Ruling issued under sub-section (1) shall be binding on the applicant.

    (5) The Ruling issued under sub-section (1) shall be binding on the Customs for a period of one year unless there is a change in law or facts or circumstances on the basis of which the advance ruling was pronounced.

    (6) The appeal against the Ruling issued under sub-section (1) shall lie with the Member Customs (Policy) within 30 days of issuance of the Ruling;

    Provided that during the appeal period of 30 days, the operation of the Ruling shall remain suspended unless the applicant accepts the Ruling.”

  • Import of heavy electric vehicles allowed at 1 percent customs duty

    Import of heavy electric vehicles allowed at 1 percent customs duty

    ISLAMABAD: Federal Board of Revenue (FBR) has allowed import of heavy electric vehicles at one percent customs duty.

    Through Finance Act, 2020 the duty at one percent has been made part of Customs Act, 1969.

    According to the Finance Act, 2020 the imports of electric buses, electric trucks and electric prime movers have been allowed at one percent of customs duty and there is no condition attach to the imports.

    However, imports of other electric vehicles including auto rickshaw, 3-wheeler loader and motorcycle have been allowed reduced duty rate at 50 percent of the prevailing tariff rate of customs duty as specified in the First Schedule to the Customs Act, 1969.

    There are conditions attached to the imports of such motor vehicles. The FBR said that the concession shall be admissible for a period of five years with effect from July 01, 2020, on import of 10 electric vehicles (CBU – Completely Buildup Unit) of the same variant to the assembled / manufactured to the extent of maximum 200 units, to 2-3 wheeler segment, duly approved / certified by the Engineering Development Board (EDB).

    The EDB shall monitor compliance with the EV Policy 2020 and intimate FBR immediately in case of violation by any manufacturer to stop further clearance at the concessional rate.

  • FBR reorganizes DG transit trade; authorizes tracking of NATO, ISAF cargo

    FBR reorganizes DG transit trade; authorizes tracking of NATO, ISAF cargo

    ISLAMABAD: Directorate General of Transit Trade has been authorized to track cargo movement of Afghan transit, NATO/ISAF and transshipment in order to avoid incidence of en-route goods slippage.

    Federal Board of Revenue (FBR) on Wednesday issued SRO 609(I)/2020 for reorganization of the Directorate General of Transit Trade.

    The FBR said that the directorate shall be based at Custom House, Karachi, assisted by Director, Directorate of transit Trade (HQ), Karachi.

    The directorate general shall have its regional offices at Karachi, Gwadar, Quetta, Peshawar, Gilgit-Baltistan and Lahore. The director general shall report to the Member (Customs), FBR.

    The directorate general of transit trade shall be responsible for enforcement of all the international agreements, treaties, conventions, domestic laws, rules and procedures relating to transit trade with reference to cross border movement of bonded cargo and domestic laws, rules and procedures relating to transshipment with reference to inland movement of bonded cargo and shall also be responsible for enforcement of laws, rules and procedures relating to international transshipment, through the respective directorates and collectorates.

    The directorate general shall also supervise functioning of the directorates, furnish policy input to the FBR on matters relating to transit trade and transshipment and maintain liaison with all stakeholders.

    The Director, Directorate of Transit Trade (HQ) Karachi shall have jurisdiction over all customs matters relating to transit, transshipment and allied functions in respect of the national territory of whole of Pakistan covering the following functions and customs matters:

    (i) Project Director in terms of SRO 4139i0/2012 dated April 25, 2012.

    (ii) Supervision of tracking and monitoring across the national territory through the Central Control Room (CCR), established at Custom House, Karachi, in coordination with Regional Control Rooms (RCRs) established at respective directorates of transit trade of the following cargo:

    (a) Transit cargo;

    (b) POL products exported to Afghanistan;

    (c) US or NATO or ISAF cargo;

    (d) Transshipment cargo;

    (e) Safe transportation cargo;

    (f) EPZ/SEZ/Free Zones cargo;

    (g) Manufacturing bonds exports cargo;

    (h) Export oriented units exports cargo;

    (i) Transportation of imported liquid bulk cargo for exclusive use of ISAF/NATO forces in Afghanistan.

    (iii) Administration, budgeting and supervision of the Mobile Enforcement Units (MEUs) deployed at Transit Monitoring Response Centers (TMRCs) across the country;

    (iv) Sealing of cargo at Karachi sea ports and Port Qasim with respect to the following cargo:

    (a) Transit cargo;

    (b) POL products exported to Afghanistan;

    (c) US or NATO or ISAF cargo;

    (d) Transshipment cargo;

    (e) Safe transportation cargo;

    (f) EPZ/SEZ/Free Zones cargo

    (g) Manufacturing bonds exports cargo;

    (h) Export oriented units exports cargo;

    (i) Transportation of imported liquid bulk cargo for exclusive use of ISAF / NATO forces in Afghanistan.

    (v) Licensing of tracking companies in terms of SRO 413(I)/2012 dated April 25, 2012;

    (vi) Development, supervision and maintenance of transit trade facilitation portal including coordination with the relevant stakeholders.

    (vii) Development, supervision and updation of Risk Management System (RMS) through the local committee constituted for transit and transshipment RMS, including coordination with the relevant stakeholders;

    (viii) Association in development, updation and enhancement of MIS function;

    (ix) Personal management;

    (x) Coordination with all stakeholders for operational purposes;

    (xi) Business process re-engineering;

    (xii) Transit trade facilitation and redressal of complaints; and

    (xiii) Any other function assigned by the FBR from time to time.

  • FBR extends warehousing period up to July 31

    FBR extends warehousing period up to July 31

    ISLAMABAD: The Federal Board of Revenue (FBR) has taken a significant step by extending the warehousing period for already in-bonded goods up to July 31, 2020.

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  • FBR exempts customs duty on oxygen gas, cylinder import

    FBR exempts customs duty on oxygen gas, cylinder import

    In response to the ongoing COVID-19 pandemic, the Federal Board of Revenue (FBR) announced on Wednesday an exemption from customs duty on the import of oxygen gas and oxygen gas cylinders. This measure aims to ensure the availability of these essential supplies as the country battles the spread of the virus.

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  • Security forces to provide monthly details of confiscated smuggled goods to FBR

    Security forces to provide monthly details of confiscated smuggled goods to FBR

    ISLAMABAD: Security forces engaged in anti-smuggling activities to submit monthly seizure report to Federal Board of Revenue (FBR).

    The FBR issued SRO 578, 579 and 580(I)/2020 to amend Customs Act, 1969 making it mandatory for security forces to furnish monthly report of seizure report to the customs authorities.

    The FBR has entrusted Frontier Corps, Pakistan Rangers, Pakistan Maritime Security Agency and Pakistan Coast Guards to exercise the powers of customs authorities in preventing smuggling.

    The Pakistan Rangers and Frontier Corps have been authorized to exercise powers of customs officials against smuggling since 2010. Meanwhile, Pakistan Maritime Security Agency and Pakistan Coast Guards was entrusted to exercise powers of customs officials since 2014.

    The FBR every year extends the authority in the month of June. Through the latest SROs the FBR extended the powers till June 30, 2021.

    As per the SROs the law enforcement agencies are required to provide details of seized goods/vehicles handed over to Pakistan Customs in a month to the Collector of Customs (Enforcement and Compliance) within their respective jurisdiction by 5th day of each month.

  • FBR imposes up to seven percent additional customs duty

    FBR imposes up to seven percent additional customs duty

    ISLAMABAD: Federal Board of Revenue (FBR) has started preparation for achieving revenue collection target for fiscal year 2020/2021 as it massively increased additional customs duty up to 7 percent from July 01, 2020.

    The FBR issued SRO 572(I)/2020 on Tuesday for levying additional customs duty at different rates of two percent, four percent and seven percent.

    The FBR provisionally collected Rs3.957 trillion for fiscal year 2019/2020. As per budget documents the FBR has been assigned to collect Rs4,963 billion during the fiscal year 2020/2021, which is around 25 percent higher than collection of fiscal year 2019/2020..

    The government while presenting the budget 2020/2021 had claimed that the budget was tax free and it had not levied any duty and tax in order to provide relief to the masses amid outbreak of coronavirus.

    However, as per the notification additional customs duty at two percent has been imposed on goods imported under tariff slabs of zero percent, three percent and 11 percent.

    Another rate of four percent additional customs duty has been levied on goods imported under tariff slab of 16 percent.

    While the rate additional customs duty at seven percent has been applied on goods imported under tariff slab of 20 percent and above.

    However, import of edible crude oil which are subject to import at higher tariff slab, the additional customs duty shall be charged at the rate of two percent, the FBR said.

    The FBR further said that additional customs duty would not be applicable on the goods imported under concessionary regime for exporters.

    Further, the additional customs duty shall also not be applicable on the contractors and services companies for offshore projects.

  • FBR issues rules for processing duty drawback claims

    FBR issues rules for processing duty drawback claims

    ISLAMABAD: Federal Board of Revenue (FBR) on Monday issued draft rules for processing duty drawback claims in order to speedy repayment of exporters.

    The FBR issued SRO 561(I)/2020 to amend Customs Rules, 2001 for processing and sanctioning of duty drawback claims.

    The FBR said that the claims of duty drawback shall be sanctioned by the Customs if the same are complete in all respect and on first in first out (FIFO) basis.

    However, comprehensive audit of duty drawback would be carried out by the Directorate General of Post Clearance Audit (PCA) of the FBR.

    Any recovery detected by the PCA may be deducted from the next duty drawback claim of the exporter besides initiating recovery proceedings under the recovery rules.

    The duty drawback payment of such claims that are complete in all respects shall be made on FIFO basis taking into account the date of filing of claim.

    A consolidated discrepancy report shall be sent by the collectorate to State Bank of Pakistan (SBP) on monthly basis. The SBP shall also send a scroll of all the duty drawback payments made to the exporters.

    For calculating amount of customs duties paid at the time of import, past six months import data may be used taking the average quantity or value of each class or description of the materials, including packing materials, from which a particular class or description of goods is ordinarily produced or manufactured. Average exchange rates of the same period may be taken into consideration.

    The average amount of customs duties paid on imported materials used in the manufacturing of components, intermediate or semi-finished products which are exported as such or further used for manufacture of goods shall be taken into account for the purpose of calculation of the duty drawback.

    The average amount of customs duties paid at the effective rate on the imported input materials shall be calculated for the last six months import data.

    The average FOB (freight on board) value of each class or description of the goods exported during the last six months may be taken into consideration for the class or description of goods for which export drawback rates are being determined.

    On requisition by the relevant association, director general may furnish trade statistics pertaining to each class or description of imported or exported goods for the past six months on the basis of which export drawback rates need to be determined.

    At the time of submitting an application, the association shall specify the complete calculation in accordance with the method of calculation as the FBR may notify and shall also furnish therewith the worksheets.

    The Director General may initiate exercise for determination of duty drawback rates on its own motion where it is found that: duty drawback rates have not been determined; where already determination rates have changed due to amendments in tariffs.

  • FBR grants Rs45 billion customs duty exemption under free trade agreements

    FBR grants Rs45 billion customs duty exemption under free trade agreements

    In a significant move to bolster trade and economic relationships, the Federal Board of Revenue (FBR) has granted Rs45 billion in customs duty exemptions and concessions on imports under various Free Trade Agreements (FTAs) and Preferential Trade Agreements (PTAs) for the fiscal year 2019/2020.

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  • Illegal trading of currency, gold to be liable for imprisonment up to 14 years

    Illegal trading of currency, gold to be liable for imprisonment up to 14 years

    KARACHI: Passengers or crew members found involved in illegal trading of currency, gold or precious stones to be convicted with up to 14 years imprisonment along with huge amount of fine and penalty.

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