Karachi, February 4, 2025 – The Directorate General of Valuation of Pakistan Customs has issued a new valuation ruling for determining duties and taxes on the import of lithium-ion batteries, aiming to curb under-invoicing and ensure fair taxation.
Background of the Issue
Pakistan Customs initiated this valuation exercise following multiple complaints from industry stakeholders regarding significant under-invoicing in the import of lithium-ion batteries. To address this, the Directorate conducted a thorough analysis of import data, global market trends, and discrepancies in declared customs values.
Determining Customs Values
Several consultative meetings were held with stakeholders to finalize the valuation. During these discussions, industry representatives contended that lithium-ion batteries were being grossly undervalued by certain importers, leading to revenue losses. The Directorate requested relevant import documents to substantiate their claims and retrieved 90 days’ worth of import data for scrutiny. Although references of declared values were available, discrepancies necessitated further verification.
Methods Used for Valuation
Pakistan Customs followed the valuation methods outlined in Section 25 of the Customs Act, 1969. The transaction value method was found inapplicable as declared values in most cases did not align with market rates. The assessment of identical and similar goods under Sections 25(5) & (6) provided some reference points but was insufficient due to market fluctuations. Consequently, a market inquiry under Section 25(7) was conducted, involving direct price checks from various commercial hubs. However, the large variation in lithium-ion battery prices posed a challenge.
Due to the unavailability of manufacturer pricing, the computed value method under Section 25(8) was also deemed unfeasible. Eventually, the customs valuation was determined using Section 25(9), with necessary adjustments for profit margins and freight costs.
Customs Values of Lithium-Ion Batteries
The finalized customs values for different lithium-ion battery categories are as follows:
| S.No | Description of Goods | PCT Code | Proposed PCT for WeBOC | Origin | Customs Value (C&F) in USD |
| 1 | Lithium-Ion Batteries (IP-20) | 8507.6000.1000 | 7/Kg | All Origins | 70/KW |
| 2 | Lithium-Ion Batteries (IP-21) | 8507.6000.1100 | 8/Kg | All Origins | 80/KW |
| 3 | Lithium-Ion Batteries (IP-65) | 8507.6000.1200 | 9/Kg | All Origins | 90/KW |
Implementation and Compliance
This valuation ruling does not apply to lithium-ion batteries intended for mobile phones, laptops, tablets, or similar consumer electronics. If an importer declares a value higher than the prescribed customs valuation, the assessment will be made at the higher declared value under Section 25(1) of the Customs Act, 1969.
For air shipments, the difference between air and sea freight costs will be accounted for in the valuation assessment. All collectorates have been instructed to implement this ruling, and any anomalies should be reported to the Directorate of Valuation for immediate review.