Islamabad, March 28, 2024 – Pakistan Customs has made a decisive ruling regarding the classification of duties on imported multi-vitamins, natural health products, and food supplements.
The decision, which imposes a 20 percent duty, comes after a thorough review by the Customs Classification Committee.
The committee’s decision supports the assessment made by a customs collectorate, which had previously imposed a 20 percent customs duty on the import of these health-related products. Despite arguments presented by importers advocating for a reduced rate of 11 percent duty, citing the products’ classification as “Natural Health Products” according to the Drug Regulatory Authority of Pakistan (DRAP), the committee upheld the higher duty rate.
The primary point of contention revolved around the classification of the imported goods under the Pakistan Customs Tariff (PCT) headings. Specifically, the question arose whether these items should be categorized under PCT heading 3004.5090 or 2106.9090, or any other relevant heading.
Goods falling under PCT heading 3004.5090 are typically subject to an 11 percent customs duty, while those falling under PCT heading 2106.9090 face a higher duty rate of 20 percent.
The dispute stemmed from a series of import consignments by M/s Base6 (Pvt) Ltd., which declared the goods under HS code 3004.5090, supported by a clearance certificate from DRAP. However, the Collectorate of Customs Allama Iqbal International Airport (ALIA), Lahore contended that the products should be classified under PCT heading 2106.9090 as “Food, Dietary Supplements.”
The Classification Committee carefully reviewed the arguments and relevant documentation provided by both parties, alongside pertinent provisions of the law regarding classification. Ultimately, it was determined that the imported goods, labeled as “Natural Health Products,” were incorrectly classified under PCT heading 3004.5090 at a duty rate of 11 percent.
Upon analysis, it was found that the imported goods were not intended for therapeutic or prophylactic use in measured doses but were marketed to contribute to general health and well-being. As such, they were deemed appropriate for classification under PCT heading 2106, attracting a 20 percent customs duty.
This ruling represents a significant decision by Pakistan Customs regarding the classification and duty rates applied to health-related products entering the country. Importers and stakeholders in the health industry will need to adhere to these classifications and associated duties in their importation processes moving forward.
With this decision, Pakistan Customs aims to ensure accurate classification of imported goods, thereby safeguarding revenue streams and maintaining regulatory compliance within the health sector.