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Category: Pakistan Customs

Pakistan Customs updates covering trade regulations, import-export policies, enforcement actions, and customs procedures at ports and border stations.

  • Key changes to customs laws amended through Finance Bill 2020

    Key changes to customs laws amended through Finance Bill 2020

    ISLAMABAD: The government has announced major changes to Customs Act, 1969 through Finance Bill, 2020.

    EY Ford Rhodes Chartered Accountants highlighted the key changes to Customs Act, 1969 that are amended through Finance Bill, 2020.

    Following are the key changes introduced through Finance Bill, 2020:

    • Procedure to obtain advance ruling has been prescribed along with revision in the definition of advance ruling
    • The penalties related to smuggling are proposed to be more rationalized along with the change in the definition of smuggling, to broaden its scope.
    • It is proposed to decide cases related to smuggling by the ATIR within a period of thirty days.
    • Exemption of customs duties on imports for setting up new industries in erstwhile FATA area is proposed to be extended up to year 2023.
    • Concessions available to Special Economic Zones are proposed to be enhanced.
    • Tariff protection is proposed for domestic industry by increasing / levy of regulatory duty on import of items which are locally manufactured.
    • Customs duty on 90 Tariff lines are proposed to be reduced from 11 percent to 3 percent and 0 percent for the purpose of Tariff rationalization under National Tariff Policy, 2019.
    • To boost exports and to secure domestic manufacturing sector, duties on more than 40 tariff lines are proposed to be exempted or reduced.
    • Reduction in regulatory duty on several items is proposed to discourage the smuggling of goods and to decrease the cost of doing business in several sectors.
    • Extension in exemption period, which was due to be expired on 20 June 2020, from customs duties on import of goods including edible oils and oil seeds covered under COVID-19 relief package.
    • Exemption / reduction in customs duty is proposed to be available to the manufacturers, subject to IOCO quota determination, in respect of the following-
    • Exemption – Butyl Acetate, Syringes and saline infusion sets, buttons, raw material for beverage can manufacturing and import of machinery, equipment and other project related items for setting up of internet cable landing station.
    • Reduction – Raw material for manufacturing of interlining/bukram, wire rod, food packaging.
    • Additional customs duty is proposed to be reduced on those tariffs lines on which customs duty is applicable at 0 percent, including on Palm Stearin for incentivizing soap manufacturing industry.
    • Regulatory duty on Hot Rolled Coils (HRC) of Iron and steel falling under PCT Codes 7208 and 7225 & 7226 respectively is proposed to be reduced from 12.5 percent and 17.5 percent to 6 percent and 11 percent respectively.
    • Exemption in duties & taxes on import of dietetic foods for children with inherited metabolic disorders, diagnostic kits for cancer and corona virus, Ready to use Supplementary Foods (RUSF), lifesaving drug Meglumine Antimonite for treatment of leishmaniasis.
  • Customs law amended related to burden of proof

    Customs law amended related to burden of proof

    ISLAMABAD: The Finance Bill 2020 has made amendments to Customs Act, 1969 and made it mandatory for a person alleged of any offence is required to prove that property acquired by him is not from proceed of crime.

    The Finance Bill 2020 proposed to amend Section 187 of Customs Act, 1969. Following amendment has been proposed (changes in red):

    187. Burden of proof as to lawful authority etc.- When any person is alleged to have committed an offence under this Act and any question arises whether he did any act or was in possession of anything with lawful authority or under a permit, license or other document prescribed by or under any law for the time being in force, the burden of proving that he had such authority, permit, license or other document shall lie on him:

    “Provided that any person, alleged to have committed an offence under this Act, shall bear the burden of proof that any property owned by him in his name or someone else name was not acquired from the proceeds of such crime:

    Provided further that the procedure for forfeiture of such property shall be prescribed by the Board under the rules.”;

  • Law tightened to prevent fiscal fraud on imported goods

    Law tightened to prevent fiscal fraud on imported goods

    ISLAMABAD: The Finance Bill, 2020 issued on Friday has proposed tightening customs law to prevent fiscal fraud on imported goods.

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  • Duty, taxes up to Rs5,000 exempted on imported goods

    Duty, taxes up to Rs5,000 exempted on imported goods

    ISLAMABAD: An amount up to Rs5,000 has been exempted in case minimum total duty and taxes on imported goods.

    An amendment to Customs Act, 1969 has been introduced through Finance Bill, 2020 issued on Thursday.

    Through the amendment the minimum duty and taxes that is not demanded by the customs authorities have been increased to Rs5,000 from existing Rs1,000.

    Through the bill Section 19C of the Customs Act, 1969 has been substituted.

    Finance Bill proposed following amendment to the Customs Act:

    “19C. Minimal duties not to be demanded.- Where the value of imported goods does not exceed five thousand rupees, no duties and taxes shall be demanded, subject to conditions and restrictions as may be prescribed by the Board under the rules.”

  • Advance ruling in Customs laws introduced

    Advance ruling in Customs laws introduced

    ISLAMABAD: The government has introduced mechanism of advance ruling to facilitate importers and investors to ensure transparency in clearance process.

    Section 212B has been inserted to the Customs Act, 1969 through Finance Bill, 2020 to introduce advance ruling.

    Section 212B: Advance Ruling.

    (1) An applicant desirous of advance ruling shall 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 (2), 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 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 notifications 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 may specify by notification in the official Gazette.

    (3)The advance ruling issued under sub-section (1) shall be binding on the applicant.

    (4)The advance ruling issued under sub-section (1) shall be binding on the customs collectorates for the period specified by the Board in the rules, unless there is a change in law or facts or circumstances on the basis of which the advance ruling was pronounced.

  • Customs duty exempted on import of industrial raw material

    Customs duty exempted on import of industrial raw material

    ISLAMABAD: Federal Minister for Industries and Production Hammad Azhar announced to exempt customs duties on import of industrial raw material.

    While presenting the Budget 2020/2021, the minister highlighted the key points of changes brought to Customs Act, 1990 through Finance Bill, 2020.

    He said that the government had initiated customs tariff rationalization during the last year and allowed exemptions from customs duties on 1600 tariff lines of raw material.

    In order to reduce cost of production it is suggested that all raw material should be exempted from customs duty from next fiscal year.

    These exemptions has been proposed for import of raw material for manufacturing of chemicals, leather, textile, rubber, fertilizers etc.

    These tariff lines include 20,000 items which are around 20 percent of the total imports.

    Furthermore, he said that customs duty has been reduced on 200 tariff lines on import of raw material and secondary products which, included bleaching, rubber and raw material for home consumption.

    Hammad Azhar on the floor of the National Assembly said that regulatory duty has been reduced to 6 percent from existing 12.5 percent on import of hot rolled coils for encouraging domestic engineering sector.

    He said that the regulatory duty has been reduced on various products in order to discourage smuggling. The minister said that in the past regulatory duty was imposed which resulted in reduction of import of such goods. However, it is observed that some products were imported by Afghanistan and then entered into Pakistani markets.

    Therefore, it is suggested the reduction of regulatory duty on import of cloths, sanitary ware, electrodes, blankets, pad locks etc.

    The government has also abolished duty and taxes on import of diagnostic kits for coronavirus and cancer to provide relief to the masses. Further, duty and taxes have also been abolished on import of special food supplements and dietetic food.

  • FBR reconstitutes licensing committee for tracking transit, transshipment cargo

    FBR reconstitutes licensing committee for tracking transit, transshipment cargo

    ISLAMABAD: Federal Board of Revenue (FBR) has re-constituted committee for grant of license for tracking transit and transshipment cargo.

    The FBR on Wednesday issued SRO 542(I)/2020 dated June 08, 2020 to amend Tracking and Monitoring of Cargo Rules, 2012.

    The reconstitution of committee shall comprise of Director General of Transit Trade (Chairman), Director Transit Trade (I-IQs), Karachi, Director Transit Trade (Peshawar), Director Transit Trade (Quetta), Director Reforms and Automation (Karachi), Collectors of Customs (Enforcement and Compliance, Karachi), (Appraisement and Facilitation, Port Muhammad Bin Qasim, Karachi), (Appraisement and Facilitation-East, Karachi), (Appraisement and Facilitation-West), Karachi, and Director of Intelligence and Investigation, FBR, Karachi or any other authority designated by the FBR Headquarter.

    As per amendment the project director shall be Director (HQs), Directorate General of Transit Trade. Previously, the project director was Collector, Model Collectorate of Customs (Preventive).

    In another amendment, Director Transit Trade (HQs), Karachi shall be the convener of the Licensing Committee and its headquarters shall be located in Directorate General of Transit Trade, Karachi. The Director Transit Trade (HQs), Karachi shall provide secretarial and other allied support required for functioning of the Licensing Committee.

    A new rule introduced through the amendment that any function enumerated in these rules including mounting and un-mounting of tracking devices in the designated areas, whereof, the staff of the Directorate General of Transit Trade is not posted, shall be performed by the staff of the respective Enforcement and Compliance or Composite Customs Collectorate of jurisdiction.

  • FBR allows repayment of customs duty on import of plastic raw material

    FBR allows repayment of customs duty on import of plastic raw material

    ISLAMABAD: Federal Board of Revenue (FBR) has allowed repayment of customs duty at Rs5.42 per kilogram on import of raw material for manufacturing of plastic goods meant for export.

    The FBR on Tuesday issued SRO 461(I)/2020 to amend SRO 212(I)/2009 to allow repayment of export duty on import of raw material.

    Through the instant SRO the FBR allowed duty drawback on import of 10 different raw material for the manufacturing of plastic goods at the rate of Rs5.42 per kilogram.

    The FBR allowed duty drawback on export of manufactured products from May 20, 2020. The FBR said that repayment of custom duty shall be paid on manufacturing of 100 percent goods including packaging materials used in the goods meant for export such as bottles, jars, vials, containers, droppers and the like.

    The conditions for the facility prescribed in the actual SRO is that:

    — the manufactured goods are exported out of Pakistan and an application for repayment of customs–duties is presented to the proper officer of Customs within two hundred and ten days of such exportation or within one hundred and eighty days from the date of realization of foreign exchange as shown on Bank Credit Advice issued in accordance with the current directive of the State Bank of

    Pakistan; and

    — the exporter makes a declaration on the goods declaration filed under section 131 of the Customs Act, 1969 (IV of 1969) and on other export documents for his claim for repayment of the customs–duties paid on the imported raw materials used in the production or manufacture of the goods being exported.

  • FBR advised to allow examination before filing GDs

    FBR advised to allow examination before filing GDs

    KARACHI: Federal Board of Revenue (FBR) has been advised to allow examination/ weighment should be allowed before filing goods declaration (GDs) in order to verify contents of containers.

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  • Time limit for customs valuation issuance should be fixed

    Time limit for customs valuation issuance should be fixed

    KARACHI: Federal Board of Revenue (FBR) has been recommended to fix time limit for issuance of customs valuation.

    Federation of Pakistan Chambers of Commerce and Industry (FPCCI) in its proposals for budget 2020/2021, said that the validity of Valuation Ruling under Section, 25-A of the Customs Act, 1969 is life time utill or unless revised or rescinded by the competent authority and Genuine Importer suffer as the Assessing Offices reject the transaction Values and Increase the Values of Assessments.

    Time limit may be fixed for issuance of Valuation Ruling under subsection 1 of section 25A of Custom Act, 1969, may not be more than 30 days and validity period under subsection 4 of section 25A of the Act should not be more than 90 or 120 days as we have fast internet system in the world over.

    (i) The following proviso may be inserted after subsection 1 of section 25A of the ACT,1969.

    “Provided that the time limit to notify the customs values under subsection 1 of section 25A should not me more than 30 days from date of first initiative of the subject exercise”.

    (ii) The words after the “applicable” in subsection 4 of section 25A should be substituted as; “till ninety days from the date of issuance of determined customs values.”