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Category: Pakistan Customs

  • Customs law amended to recover unpaid amount from exporters

    Customs law amended to recover unpaid amount from exporters

    KARACHI: The government has put a check on exporters related to unpaid amount of duty and taxes at the time of export clearance and amended law to recover the same.

    Through Finance Bill 2019, it is proposed to amend Section 32(3)(A) of Customs Act, 1969 to apply this check on exporters.

    Sub-section (3A) of Section 32 deals with the issuance of show cause notice in the situation where any duty, taxes or charge has not been levied, short-levied or erroneously refunded, discovered as a result of an audit or examination of an importer’s accounts or by any other means.

    The Finance Bill 2019 seeks to extend the application of this section to exporters as well.

    The existing law under Section 32(3)(A) said:

    Notwithstanding anything contained in sub-section (3), where any duty, taxes or charge has not been levied or has been short-levied or has been erroneously refunded and this is discovered as a result of an audit or examination of an importer’s accounts or by any means other than an examination of the documents provided by the importer at the time the goods were imported, the person liable to pay any amount on that account shall be served with a notice within five years of the relevant date requiring him to show cause why he should not pay the amount specified in the notice:

    Provided that if the recoverable amount in a case is less than one hundred rupees, the Customs authorities shall not initiate the aforesaid action.

  • FBR empowered to impose fee, service charges under Customs laws

    FBR empowered to impose fee, service charges under Customs laws

    KARACHI: Federal Board of Revenue (FBR) has been empowered to impose service charges and date of determination of rate of import duty under Customs Act 1969.

    The Finance Bill 2019 has proposed delegation of powers from federal government to the FBR, which included: levy of fee and service charges; date of determination of rate of import duty; date of determination of rate of duty for clearance through the Customs Computerized System; and date for determination of rate of duty on goods exported.

    The bill proposed delegation powers to FBR under Section 18D, 30, 30A and 31 of Customs Act, 1969.

    Presently Section 18D of Customs Act, 1969 states:

    18D. Levy of fee and service charges.- The Federal Government may, by notification in the official Gazette, subject to such conditions, limitations or restrictions as it may deem fit to impose, levy fee and service charges for examination, scanning, inspections, sealing and desealing, valuation check or in respect of any other service or control mechanism provided by any formation under the control of the Board, including ventures of public-private partnership, at such rates as may be specified in the notification.

    Presently Section 30 of Customs Act, 1969 states:

    30. Date of determination of rate of import duty.- The rate of duty applicable to any imported goods shall be the rate of duty in force;

    (a) in the case of goods cleared for home consumption under section 79, on the date on which a goods declaration is manifested under that section; and

    (b) in the case of goods cleared from a warehouse under section 104, on the date on which a goods declaration for clearance of such goods is manifested under that section:

    Provided that, where a goods declaration has been manifested in advance of the arrival of the conveyance by which the goods have been imported, the relevant date for the purposes of this section shall be the date on which the manifest of the conveyance is delivered at the port of first entry:

    Provided further that, in respect of goods for the clearance of which a goods declaration for clearance has been manifested under section 104, and the duty is not paid within seven days of the goods declaration being manifested, the rate of duty applicable shall be the rate of duty on the date on which the duty is actually paid:

    Provided further that in case of the goods illegally removed from the warehouse, the rate of duty shall be the rate prevalent either on the date of in-bonding or detection of case or date of payment of the duty and taxes, whichever is higher:

    Provided further that in case of exercising option for redemption of fine in lieu of confiscation of the goods seized during anti-smuggling operations, the rate of duty shall be the rate prevalent either on the date of seizure or date of payment of duty and taxes, whichever is higher:

    Provided further that the Federal Government may, by notification in the official Gazette, for any goods or class of goods, specify any other date for the determination of rate of duty.

    Explanation:- For the purpose of this section “manifested” means that when a machine number is allocated to goods declaration and is registered in Customs record.

    Presently Section 30A of Customs Act, 1969 states:

    30A. Date of determination of rate of duty for clearance through the Customs Computerized System.- Subject to the provisions of section 155A, the rate of duty applicable to any imported or exported goods if cleared through the Customs Computerized System, shall be the rate of duty in force on;-

    (a) the date of payment of duty;

    (b) in case the goods are not chargeable to duty, the date on which the goods declaration is filed with Customs.

    Provided that where a goods declaration has been filed in advance of the arrival of the conveyance by which the goods have been imported, the relevant date for the purposes of this section shall be the date on which the manifest of the conveyance is filed at the customs-station of first entry:

    Provided further that the Federal Government may, by notification in the official Gazette, specify any other date for the determination of rate of duty in respect of any goods or class of goods.

    Presently Section 31 of Customs Act, 1969 states:

    31. Date for determination of rate of duty on goods exported.- The rate and amount of duty applicable to any goods exported shall be the rate and amount chargeable at the time of the delivery of the goods declaration under section 131:

    Provided that where the export of any goods is permitted without a goods declaration or in anticipation of the delivery of such a declaration, the rate and amount of duty applicable shall be the rate and amount chargeable on the date on which loading of the goods on the outgoing conveyance commences:

    Provided further that the Federal Government may, by notification in the official Gazette, for any goods or class of goods, specify any other date for determination of the rate of duty.

  • Collectors’ power to determine customs values withdrawn

    Collectors’ power to determine customs values withdrawn

    KARACHI: The government has withdrawn the power of Collector of Customs in determination of customs value on his own motion through Finance Bill 2019.

    The Finance Bill 2019 proposed to withdraw the powers of the collector of customs to determine customs valuations on his motion under Section 25A(1) and Section 25A(3) of Customs Act, 1969.

    The collector of customs presently has powers to determine the customs values under Section 25A.

    The sub-section 1 of Section 25A states: Notwithstanding the provisions contained in section 25, the Collector of Customs on his own motion, or the Director of Customs Valuation on his own motion or on a reference made to him by any person or an officer of Customs, may determine the customs value of any goods or category of goods imported into or exported out of Pakistan, after following the methods laid down in section 25, whichever is applicable.

    The sub-section 3 of Section 25A states: In case of any conflict in the customs value determined under sub-section (1), the Director-General of Customs Valuation shall determine the applicable customs value.

    The powers of determining customs values have now been proposed to be available with Director of Customs Valuation.

    Analysts said that this proposal in the Finance Bill 2019 would provide relief to import in clearance of consignments. They said that many arbitrary decisions of Collector have created hassles for the importers in the past and consignments were stuck up for a long time.

  • MCC Appraisement East announces auction of confiscated vehicles on June 17

    MCC Appraisement East announces auction of confiscated vehicles on June 17

    KARACHI: Model Customs Collectorate (MCC) Appraisement East has announced public auction of confiscated vehicles on June 17, 2019 at Anti-Smuggling Organization (ASO) Office, Ghasbandar Kemari, Karachi.

    Following vehicles will be presented for auction:

    1. Mitsubishi Pajero Jeep (used), Reg.GS-2000, Model-1994,Chassis -V46-4034791/Engine-4M4D EXT T7UF.

    2. Used Toyota Lexus Car, Reg no UC-868, Model 2006(as per seat belt), Chassis JTHBG963905034702/Engine EMH-3 GR-FE158467-3485cc.

    3. Used Toyota Harrier Jeep, Reg no JAA-454, Model -1998-2999cc,Chassis no MCU-10-0013510, Engine no IMZ-FE6688090.

    4. Used Honda Saloon Accord Car, Reg no-BFT-418, Model-2003, 1990cc, Chassis no-CL7-3006339, Engine No-33101802.

    5. Used Mercedes Benz (AG), Reg No-AB-1001, Model-1991-02, 2999cc, Chassis no-WDB1240312B476728.

    6. Used Toyota Mark-II Saloon Car, Reg No-BVL-708, Model-2000, 1800HP, Chassis no-JZX110-6000922, Engine No-1JZ-075010.

    7. Used Toyota AXIO-X Car-White Colour, Reg No-BFE-068, 1496cc, Model-2007, Chassis no-NZE-141-6028039, Engine no, INZ-C0360547.

    8. Used Toyota Land Cruiser Jeep-Silver Colour, Reg No-BG-1131, Model No-1989, 3400cc, Chassis No-BJ60-023765, Engine No, 3B-1098887( As Per Reg Book) Diesel.

    9. Used Toyota Saloon Car XE, Model no-1999, 1500cc, Colour Red, Chassis No-AE-100-5171778, Engine-SA-FE-1500cc.

    10. Used Toyota Premio Saloon Car, Reg No-BFM-306, Model No-2004, Chassis No-AZT240-0017447, Engine No- 1AZ -4802097.

    11. Used Toyota Mark-X Car, Reg No- BBC-301, Model No-200used5, Chassis No-GRX-120-0042956, Engine No- 4GR-FSE-2499cc.

    12. Used Toyota Crown Royal Saloon (G) Car, Reg no- BEZ-998, Model 2005, Chassis No. GRS 182-1015624, Engine no 0123426-2994cc.

    13. Used Toyota Land Cruiser Jeep, Reg no. LEB-06-2007, Model 1996-2982cc-silver colour, Chassis No VZ95-0004948, Engine No. IKZC679955.

    14. Used Toyota Premio Car, Model 2005, Reg No. AAQ-945-Qta, Chassis No ZZT-240-5041761, Engine No. 1ZZFE-2200724, 1794cc, white colour.

    15. Used Toyota Surf Jeep, Model 2007, Reg no- BF-9925, Chassis No TRN210-0002425, Engine no 2TR-0341543, 2697cc, tearl white.

    16. Used Toyota Land Cruiser Jeep, Model 2004, Reg no JAG-345, chassis no KDJ121-0001884, Engine no 1KD-1184169,2982cc.

    17. Used Toyota Land Cruiser Jeep, Model-2003, Reg no BF-8255, Chassis no UZJ100-0144369, Engine no 2UZ-FE9091472, 4700cc, white.

    18. Used Mercedes Benz Saloon Car, Model-2007, chassis no WDD2193222A117436, Engine no 64292040471958, 3200cc, Black.

  • Customs initiates examining exporters to check under-invoicing, mis-declaration

    Customs initiates examining exporters to check under-invoicing, mis-declaration

    KARACHI: Pakistan Customs has initiated examination of exporters’ profiles to check mis-declaration and under-invoicing for plugging revenue leakages.

    A statement said on Friday that the chairman of Federal Board of Revenue (FBR) Shabbar Zaidi had directed to identify the extent of mis-invoicing in export declarations in order to ascertain the suspected items or sectors and destinations for such mis-declaration, and to categorize exporters on the basis of risk profiling by segregating compliant exporters from those engaged in mis-invoicing.

    The Customs Operations wing has tasked the Director General Customs Valuation to submit a report in this regard.

    It has been further directed to develop a risk based system to intercept this trend without compromising export facilitation. Punitive action shall be taken against unscrupulous exporters under the proposed Section 32 C of the Customs Act, 1969 and the allied laws.

    This initiative has arisen in the backdrop of reports indicating mis-invoicing in exports, which includes under-invoicing resulting in loss of remittance of forex and over-invoicing used to transfer excessive funds abroad.

    Under-invoicing could be used also possibly as a mechanism for trade-based money laundering. One of the suspected methods used in under-invoicing in exports is through the medium of via port cargo.

    Export cargoes are mis-declared by under-invoicing the values of export commodities, and shipped to a via port wherein new declaration with actual values are re-shipped for a final destination.

    As a consequence, lesser amount of foreign exchange is remitted to Pakistan and a major portion of export proceeds is retained in the other country.

  • Budget 2019/2020: Salient features of customs duty

    Budget 2019/2020: Salient features of customs duty

    ISLAMABAD: The government has announced changes in customs duty regime which included relief and revenue measures.

    RELIEF MEASURES

    1. To standardize printing and preservation of Holy Quran, import of good quality duty free Art paper is being allowed.

    2. Exemption of CD on 18 medicinal inputs/items

    3. Exemption of CD on Modular/ Particle Free Operation Theatre

    4. Exemption of CD on Medicines for certain rare diseases

    5. Incentive to promote tourism by reducing duty on pre-fabricated structures for hotels

    INCENTIVIZING LOCAL INDUSTRY:

    1. Exemption of CD on more than 1650 raw materials/industrial inputs

    2. Reduction of CD on Writing & Printing Papers

    3. Exemption of CD on Raw- materials of Paper Industry

    4. Exemption of CD on import of Wood

    5. Reduction of CD on Glass Board for LED Panel manufacturing

    6. Reduction of CD on input goods for paper based Liquid Food Packaging Industry

    7. Reduction of CD on Acetic Acid

    8. Reduction of CD on Nonwoven fabrics

    9. Exemption of CD on Machinery Parts / Accessories for Textile Sector

    10. Exemption of CD on Elastomeric Yarn

    11. Rationalization of CD on Aluminium Beverage Cans & Inputs thereof

    12. Exemption of CD on raw material for hemodialyzers used by kidney patients

    13. Tariff rationalization on Home Appliance Sector

    14. Reduction of CD on Base Oil as input for Coning Oil, White Oil and other Textile Oils

    15. Reduction of CD on Raw Material for Manufacturing of Pre-Sensitized Printing Plates

    16. Exemption of CD on Preparations for Metal Surfaces as input for Solar Panels

    17. Exemption of CD on Foundation Cloth

    18. Reduction of Duty on Wooden Sheets for Veneering

    19. Reduction of CD on Oxalic Acid

    20. Reduction of CD on Raw Material of Powder Coating Industry

    21. Reduction of CD on Raw Material for Paper Sizing Agents

    22. Reduction of CD on Bobbins & Spools of Paperboard

    23. Exemption of CD for Hydrocracker Industry for oil refining

    24. Rationalization of tariff structure for SIM card manufacturing industry

    REGULATORY DUTY:

    1. Reduction of RD on Mobile Phones

    2. Reduction of RD on smuggling prone items and other industrial inputs

    3. Reduction of RD on Tyres

    REVENUE MEASURES:

    1. Increase in rate of Additional Customs Duty for non-essential items

    2. Withdrawal of exemption on import of LNG

  • MCC Appraisement East announces auction of trucks

    MCC Appraisement East announces auction of trucks

    KARACHI: Model Customs Collectorate (MCC) Appraisement East has announced auction of dump trucks and other heavy construction machinery on June 10, 2019 at East Wharf Karachi.

    Following machinery will be presented for auction:

    01. OLD AND USED ASPHALT PAVER, MODEL:PE-150B, ENGINE NO. BC0206, SERIAL NO. 76857, I/O. AND BRAND NOT SHOWN, WEIGHT: 5 MT. 1 UNIT

    02. OLD AND USED DOUBLE CABIN NISSAN TADANO CRANE, SERIAL NO. KG45S-00419, BRAND: NISSAN, I.O. NOT SHOWN, CAPACITY: 30 MT, WEIGHT: 17 MT 1 UNIT

    03. USED HONDA INSIGHT CAR, CH NO. ZE2-1308052, MODEL: 2011 1 UNIT

    04. OLD AND USED ROLLER MACHINE LONGWITH STANDARD ACCESSORIES, TYPE: CA255, SERIAL NO. *10100154LHE004719*1217, I/O. INDIA, MFG YEAR 12/2017, BRAND: DYNAPAC., WEIGHT: 13.22 MT 1 UNIT

    05. OLD AND USED ROLLER MACHINE LONGWITH STANDARD ACCESSORIES, TYPE: CA255, SERIAL NO. *10100154CHE004036*03117, I/O. INDIA, MFG YEAR 03/2017, BRAND: ATLAS COPCO., WEIGHT; 13.25 MT 1 UNIT

    06. USED LOADER WITH ARM, BOOM AND BUCKET, CH.NO.81K03165, ENGINE NO.N/S. MFG YEAR.N/S. IN BURNED FORM., WEIGHT: 15.55 MT (BURNED) 1 UNIT

    07. USED WHEEL LOADER WITH ARM, BOOM AND BUCKET, CH.NO.311R01700, ENGINE NO.N/S. MFG YEAR.N/S. IN BURNED FORM. WEIGHT: 12 MT (BURNED) 1 UNIT

    08. USED HITACHI EXCAVATOR IN BURNED FORM CH NO.N/S. ENGINE:N/S, WEIGHT; 15.500 MT (BURNED) 1 UNIT

    09. WHEEL LOADER IN BURNED FORM, CH NO.63R05550, ENGINE N/S. MFG YEAR N/S. ,WEIGHT: 11 MT ((BURNED) 1 UNIT

    10. USED ROAD ROLLER IN BURNED FORM CH NO. N/S. ENGINE NO. N/S., WEIGHT: 7.5 MT (BURNED) 1 UNIT

    11. CAT. WHEEL LOADER WITH BOOM ARM BUCKET, CH.NO. 22Z03317, ENGINE NO.N/S. IN BURNED FORM., WEIGHT: 11 MT (BURNED) 1 UNIT

    12. OLD AND USED HONDA FIT+HYBRID CAR. CH NO. GP5-1212997, TYPE: DAA-GP5 1 UNIT

    13. HOT ROLLED STEEL SHEETS IN COILS OF SECONDARY QUALITY, WEIGHT: 793 MT 36 COILS TP 10-13

    14. OLD AND USED VOLVO DUP TRUCK CHA.NO.YV2JS32G99A687488 MODEL. N/S. BRAND VOLVO, ORIGIN NOT SHOW 1 UNIT

    15. USED TOYOTA COASTER, AUTOMATIC, DIESEL, CH#.xzb50-0059570, MODEL: SKG-XZB50-ZXTEY, MFG YEAR 20185 1 UNIT

    16. USED MERCEDEZ CONCRETE PUMP, VIN#WDB6251371K11311, MODEL: SCHWINGS42SXG, ORIGING: GERMANY. WEIGHT: 41 MT AS PER KPT B.BOOK. 1 UNIT

    17. USED TRUCK MOUNTED CONCRETE PUMP, CH#.KL3PC77CIVK001127 (ENGRAVED), BRAND: PUTZMEISTER, MODEL: DCP52, ORIGINAL NOT SHOW: TOTAL WEIGHT: 37.84 M.T. AS PER KPT B. BOOK. 1 UNIT

  • AFU Islamabad announces auction of confiscated goods on June 03

    AFU Islamabad announces auction of confiscated goods on June 03

    The Model Customs Collectorate (MCC) Air Freight Unit (AFU) in Islamabad has declared a public auction of confiscated goods, including a substantial quantity of LCD/LED Televisions.

    (more…)
  • Customs unfolds bid to clear mobile phones on passengers’ stolen information

    Customs unfolds bid to clear mobile phones on passengers’ stolen information

    KARACHI: Pakistan Customs has unfolded a bid to steal the data of air travelers for the purpose of mobile phone registration with the Pakistan Telecommunication Authority (PTA).

    According to the details the customs staff posted Jinnah International Airport (JIAP), Karachi detained a person, who was fraudulently obtained data of air travelers including passport numbers for clearing mobile phones at customs stage and for clearing PTA restriction.

    As per regulations only PTA certified mobile phones are allowed to have active connection in Pakistan. In this regard passengers arriving from abroad are allowed to clear one mobile phone without payment of duty and taxes. However, more than one phone will attract levy.

    Details revealed that customs authorities recovered around 63 mobile phones from a passenger namely Muhammad Umar arriving from an international flight.

    The accused passenger entered details of passengers into the PTA system to get cleared the mobile phones without duty and taxes. The accused passenger managed to get clearance from the PTA for those 63 mobile phones.

    This was confirmed by Muhammad Faisal, Deputy Collector of Pakistan Custom.

    The customs official said that the authorities had lodged an FIR against the accused for smuggling cell phones and stealing information of passengers.

    Faisal said that the accused had indulged in clearing mobile phones by entering details of passengers including CNICs, flight number and passport numbers etc.

    The accused in his statement said that many travel agencies were involved in this scam.

    The customs official said that PTA had been requested to introduce bio-metric system for the clearance of mobile phones.

  • Chemical merchants advocate FTR continuation for commercial importers

    Chemical merchants advocate FTR continuation for commercial importers

    KARACHI: Chemical merchants have strongly advocated continuation of Final Tax Regime (FTR) for commercial importers in the upcoming budget.

    In a statement issued on Saturday Shahid Vaseem, Chairman, Pakistan Chemicals & Dyes Merchants’ Association (PCDMA), said that because commercial importers pay 6 percent advance non-adjustable tax at import stage, whereas industrial importers of same raw material pay only 5.5 percent adjustable/refundable advance tax or avail tax exemption certificate facility, therefore it was not justified to withdraw Final Tax Regime (FTR) from Commercial importers without giving them options of claiming tax refund and facility for issuance of Tax exemption certificate if excess tax is already paid at import stage.

    In meeting with PCDMA memebers and leading importers of industrial Raw Materials, Chairman PCDMA, said that assessed value for calculation of customs levies of an industrial raw material whether it is imported by industrial importer or commercial importer; remains same either on the basis of valuation ruling (if available), international scan (if available) or custom data; therefore, chances of under-invoicing eliminated on import of industrial raw materials.

    Shahid Vaseem said in his opinion by imposing similar rate of sales tax on industrial raw materials will also eliminate the issue of imports by non-genuine industrial importers and excess imports by the genuine industrial importers, who just import big volumes of industrial raw materials to sale in market at huge profit due to less rate of tax and in some cases got extra ordinary benefits of various SROs. Which resulted in loss of billions of rupees to government revenue.

    Shahid Vaseem demanded the Government to provide a level-playing field for commercial importers who are importing industrial raw material and supply these essential raw materials to industries in SME segment. At import stage commercial importers are paying 17+3= 20 percent sales Tax as compared to 17 percent only, if same items are imported directly by industrial importers, this renders our customer industries in SME segment un-competitive in local as well as export markets, thereby eliminating job opportunities and hurting exports of value-added goods.

    He explained that 3 percent Additional Sales Tax on import of Industrial Raw Materials if imported by Commercial Importers is irrational and unjustified, because 3 percent ADDITIONAL Sales Tax can only be applied if the Value Addition on raw material is assumed 17.65 percent, which is not possible because there is no process of value addition involved and no inputs such as Land, Buildings, Machinery, Labor, Electricity and Gas etc. are used by commercial importers of same industrial raw materials.

    On the contrary the value addition by manufacturers is assumed as 10 percent only and the GST is charged at the rate of 1.7 percent despite all the above inputs.

    He claimed that by implementing same rate of taxes and extending benefits of various SROs to commercial importers, similar to the industrial importers of Raw materials for one year will result in significant drop in import volume by the industrial importers, which will prove the misuse of reduce tax facility by the industrial importers and will provide opportunity to the government to identify non-genuine industrial importers who are only existing for importing raw materials for commercial sales.