Karachi, May 23, 2024 — Pakistan Customs has clarified the classification of imported electric vehicles, specifically addressing the duty and taxes applicable to such imports. The decision was made to eliminate ambiguity and ensure accurate categorization of electric vehicles based on their design and intended use.
The issue at hand involved the classification of a 14-seater Electric Sightseeing Bus, imported under Goods Declarations (GD) No. KPPI-HC-54226 dated February 7, 2022, and KPPI-HC-55981 dated May 4, 2023. The Collectorate of Customs Appraisement Port Muhammad Bin Qasim Karachi sought guidance on the proper description and classification of this vehicle.
After thorough review and consideration, the classification committee determined that the Electric Sightseeing Bus should be categorized under Pakistan Customs Tariff (PCT) heading 8703.1000. This decision was based on the vehicle’s specific design and operational characteristics.
Key Points of Determination:
1. Vehicle Design and Usage: The committee concluded that the 14-seater Electric Sightseeing Bus is designed primarily for short-distance passenger transport within confined areas such as airports, shopping malls, and tourist attractions. Unlike heavy commercial vehicles meant for public transport across long distances, this vehicle is more comparable to golf carts in its intended use.
2. Comparison with PCT Heading 8702: PCT heading 8702 includes motor vehicles designed for the transport of ten or more persons, including the driver, typically used for long-distance or intercity travel. However, the 14-seater Electric Sightseeing Bus does not fit these criteria as it is not intended for such purposes.
3. Similarities with Golf Carts: The committee noted that the operational and functional characteristics of the Electric Sightseeing Bus are similar to those of golf carts. These vehicles, classified under PCT heading 8703.1000, are designed for transportation within limited areas over very short distances, which aligns with the use case of the Electric Sightseeing Bus.
4. Support from WCO Opinions: The classification opinions issued by the World Customs Organization (WCO) supported the committee’s decision. For instance, the WCO classification opinion on a four-wheeled vehicle with a 351cc single-cylinder internal combustion engine, adopted in 2015, provided additional guidance for categorizing the Electric Sightseeing Bus under PCT heading 8703.1000.
5. Application of GIR-1: Under the General Interpretation Rules (GIR-1), the classification aligns with the vehicle’s intended use and operational characteristics, reinforcing the decision to classify the bus under PCT heading 8703.1000.
The clarification by Pakistan Customs is expected to streamline the import process for electric vehicles, providing clear guidelines for importers regarding the applicable duties and taxes. This decision also aligns with global standards and ensures that vehicles are taxed appropriately based on their design and usage.
By issuing this classification, Pakistan Customs aims to support the import of electric vehicles while ensuring that the tax regime remains fair and transparent. This move is part of broader efforts to modernize customs procedures and promote environmentally friendly transportation options in the country.
