Customs valuation enhanced for garments on EDE data variations

KARACHI: Pakistan Customs has enhanced the imported low-end brand garments from China and other destinations after identifying data variations in Electronic Data Exchange (EDE).

The directorate general of customs valuation has issued valuation ruling No. 1484/2020 dated November 06, 2020 to enhance the values of import garments for determination duty and tax payment at customs stage.

The customs authorities have detected discrepancies in value of goods prevailed in China and value of goods declared by importers in Pakistan.

“After analysis of EDE data few variations were observed in Chinese export data vis-à-vis import data of Pakistani imports,” the directorate said, adding that an exercise was undertaken to re-determine the customs values of subject items according to prevailing prices in the international market.

It said that meetings with importers / stakeholders were held on September 09, 2020 and October 26, 2020. The importers were asked to submit their proposals/suggestions with following documents:

i. Invoices of import during last three months showing factual value.

ii. Websites, names and email addresses of known foreign manufacturers of the item in question through which the actual current value can be ascertained.

iii. Copies of contracts made/LCs opened during the last three months showing the value of the item in question.

iv. Copies of sales tax invoices issued during the last four months showing value of supplies (excluding duty and taxes) to substantiate their contention.

The directorate said that the importers/stakeholders had failed to substantiate the said claim through documentary evidence. The meeting was also attended by representatives of All Pakistan Customs Agents Association and the Federation of Pakistan Chambers of Commerce and Industry (FPCCI).

However, the directorate said that the participants had submitted few documents which were examined.

“During the meetings the variation in values of Chinese exports vis-à-vis Pakistani imports as depicted in EDE data were also discussed in detail,” the directorate said, adding that most of the participants contended that the Chinese exporters show inflated values in their shipping bills to get benefits of higher rebate on such exports.

After considering the feedback from the stakeholders, the directorate decided to enhance the customs value of low-end brand garments by 14 percent on import of Chinese/Vietnam origin men’s suits from $16.30 to $18.60.

The directorate previously published the valuation ruling 1398/2019 on October 28, 2019.

In the latest valuation ruling No. 1484/2020, the directorate said that the values prescribed in the instant valuation ruling were only for low end brands of specified origins and would not be applied for high end/ well known brand garments such as Zara, Boss, Marks & Spencer, Next Dockers, Levis, Mango, Yello, Debenhams (Red Herring, Maine, Collection, Hammond and Co., Jeff Banks, Jasper, Cannon etc.) Banana Republic, Gap, Giordano, Pierre Cardin, Wrangler, Splash, Mothercare, Baby Shop, Armani, Exchange, Calvin Klein, Diesel, Lee, Timberland, Tommy, Hilfiger etc.

The directorate advised the clearance collectorates to take cognizance of intellectual property rights violations, during import clearance of subject goods.

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