KARACHI: The Customs Classification Committee of the Federal Board of Revenue (FBR) has ruled that the imported ‘Vinyl Composition Tiles’ are actually PVC flooring tiles and cannot be declared as a simple article of plaster for applicability of the low rates of duties and taxes.
According to a new ruling issued by the classification committee, the Collectorate of Customs, Appraisement (East), Karachi classified the impugned goods under Pakistan Customs Tariff (PCT) heading 3918.1000 in view of examination report, Explanatory Notes of 3918 and Cross Customs Classification Ruling of 2018. On the other hand, the importer did not agree with the classification of the Collectorate on the ground that the imported goods consisted of Calcium Carbonate which is more than 50%, hence classifiable under PCT heading 6809.1100.
The customs classification committee consulted the lab test reports. The Committee observed that as per the lab report, the impugned goods do not comprise of plaster or of compositions based on plaster, therefore, do not fall under HS Code 68.09. As per the lab report the impugned tiles consist of vinyl chloride in association with a substantial amount of filler Calcium Carbonate. The impugned goods are PVC tiles, containing filler such as calcium carbonate which is permitted addition to plastics of chapter 39 and there is no exclusion of such goods from the Chapter and that PVC is of the essential characteristic of the product.
The meetings of the Classification Committee were attended by the representatives of the importers, the Collectorate of Customs, Appraisement (East), Karachi and members of the Classification Committee. The representatives of the referring Collectorate reiterated their earlier stance that the impugned goods fall under the PCT heading 3918.1000. The representatives of the importers contended that their impugned goods simply consisted of fillers and calcium and recycled material which covers around 90 percent of the thickness, therefore, their products do not fall under PCT heading 3918.1000 as determined by the Collectorate.
The representatives of the importers further asserted that impugned goods on the basis of their composition of the substantial amount of filler Calcium Carbonate fall under HS Code 68.09. The representatives of the importers further contended that due to considerable amount of fillers, impugned goods are cheaper than other types of flooring tiles.
The Classification Committee also deliberated upon international practices and decisions on the subject goods and observed that as per internet, impugned goods and similar goods are sold and exported under heading 3918. The Committee further observed that there were multiple Cross Customs Classification Rulings, which also classified such products under heading 3918. Foregoing in view, Committee is of the view that the imported ‘Vinyl Composition Tiles’ are classifiable under PCT heading 3918.1000, the ruling added.
