Karachi, March 2025 – The Directorate General of Customs Valuation, Pakistan Customs, has issued a new Valuation Ruling for imported chocolates under the Customs Act, 1969.
The revised ruling, identified as Valuation Ruling No. 1980/2025, supersedes the previous ruling No. 1629/2022, updating customs values for various chocolate brands to reflect current market trends.
Background and Justification
The revision comes after a detailed analysis of import data and market trends. The last update in chocolate valuation was conducted in 2022. Since then, international market prices, exchange rates, and import patterns have changed significantly, necessitating a re-evaluation. Stakeholders, including importers, traders, and customs officials, participated in a meeting on January 16, 2025, to discuss the revised valuation.
According to officials, the previous declared transaction values of chocolates were inconsistent with actual market prices. The valuation methods provided in Section 25 of the Customs Act, 1969, were applied sequentially to determine fair and accurate customs values.
Methodology for Valuation
The Directorate conducted a market inquiry as per sub-section (7) of Section 25 of the Customs Act, 1969. Various chocolate brands were assessed based on quality, packaging, and commercial level. The declared transaction values were found to differ significantly from actual market rates. As a result, the Cost and Freight (C&F) values were determined through a comprehensive evaluation of import data and physical market inspections.
The final customs values were established using multiple valuation methods, including:
• Transaction Value Method: Found inapplicable due to discrepancies in declared prices.
• Comparable Goods Method: Provided some reference points but was not solely relied upon.
• Deductive and Computed Value Methods: Used to ensure fair assessment of taxable values.
Revised Customs Values
The new customs valuation applies to major imported chocolate brands such as Mars, Snickers, Bounty, Twix, Cadbury Dairy Milk, Toblerone, Ferrero Rocher, and Galaxy. The updated rates vary based on weight and packaging. For example:
• Mars, Bounty, Snickers, Twix (18g bars) – $6.80 per kg
• Cadbury Dairy Milk (100-149g packs) – $8.50 per kg
• Ferrero Rocher (300g packs) – $16.30 per kg
• Lindt Chocolate (various flavors, 301-500g) – $11.15 per kg
• Guylian Belgian Chocolate (assorted flavors) – $12.00 per kg
These values serve as a benchmark for customs duty and tax assessments for all chocolate imports into Pakistan.
Impact on Importers and Retail Market
The revised customs valuation is expected to impact chocolate importers, retailers, and consumers. Higher customs values may lead to increased retail prices, affecting affordability. However, officials state that the revision aligns with international market trends and ensures that import duties reflect actual product values.
Stakeholders in the chocolate import business have expressed mixed reactions. Some welcome the revision as a step toward transparency, while others fear an increase in smuggling and under-invoicing to bypass higher customs duties.
Implementation and Compliance
The Federal Board of Revenue (FBR) and relevant Collectorates of Customs have been directed to implement the new valuation. Customs officials are required to ensure proper assessment and report any anomalies. Importers have the right to challenge the valuation through a revision petition under Section 25D of the Customs Act, 1969, within 30 days.
Future Outlook
The Directorate of Customs Valuation has indicated that regular updates will be conducted to reflect changing market conditions. Importers are advised to maintain transparent documentation and adhere to the revised valuation to avoid penalties.
Pakistan’s customs authorities emphasize that the new valuation will help curb tax evasion and ensure fair competition in the market. The move also aligns with efforts to enhance revenue collection and economic stability amid fluctuating global prices.
As the new ruling takes effect, industry experts will closely monitor its impact on the chocolate import sector and consumer purchasing behavior.