Customs duty collection from imported vehicles surges by 95%

Customs duty collection from imported vehicles surges by 95%

ISLAMABAD: The collection of customs duty from imported vehicles registered a sharp growth by 95 per cent to Rs111 billion during the fiscal year 2020/2021, official data revealed on Monday.

The collection of customs duty from imported cars was Rs56.85 billion in the preceding year.

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The duty collection from imported cars was top on the list of imported goods. The share of duty collection from imported cars improved to 14.3 per cent in a total collection of customs duty during fiscal year 2020/2021. Previous year this share was 8.9 per cent.

The collection of customs duty from petroleum products registered 13.3 per cent growth to Rs94.28 billion during the fiscal year 2020/2021 when compared with Rs83.22 billion in the preceding fiscal year.

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The Federal Board of Revenue (FBR) collected Rs748 billion during fiscal year 2020/2021, which is 19.3 per cent higher when compared with Rs627 billion in the corresponding period of the last fiscal year.

Major fifteen revenue spinners exhibited 28.1 per cent growth in Customs Duty collection during 2020-2021 mainly due to 22.1 per cent increase in the dutiable imports.

Around 95 per cent growth in the collection of Customs Duty recorded in the automobile sector was due to a massive increase of 107.5 per cent in the dutiable imports while 39 per cent decline recorded in duty free imports.

A growth of 13.3 per cent in the collection of Customs Duties from petroleum products was also recorded against 11.7 per cent growth in the dutiable imports.

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Iron and steel has also exhibited 22.3 per cent growth in the collection of customs duty against 23.4 per cent growth in dutiable imports.

Out of 15 major spinners, only electrical machinery reflected marginal negative growth due to decline recorded in dutiable imports.

All other major items of Customs Duty exhibited positive growth in the collection mainly due to increased dutiable imports during 2020-2021.

The FBR said that despite lowering of tariff over the years, the Customs Duty is still one of the important sources of Federal Tax collection.

Dutiable imports are the duty base of Customs Duty. The share of dutiable imports in total imports has been 59.1 per cent during 2020-2021 which implies that there still exists a significant chunk of duty free imports. Similarly, duty-free imports have also increased by about 42 per cent which is higher than the growth in dutiable imports.

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The net collection of Customs Duty stood at around Rs.748.4 billion and has contributed around 25 per cent in the Indirect Taxes and about 16 per cent in Federal Taxes during 2020-2021.

Collection of customs duty has improved by around 19 per cent as compared to the previous year.

The major reason of this growth was 19.9 per cent growth in the dutiable imports. Thus, growth in the collection of customs duty is in line with the growth in its base.

The target of Customs Duty was Rs. 700 billion during 2020-2021 which was surpassed by around 7 per cent.

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