KARACHI: The Directorate Post-Clearance Audit (PCA) South has an elaborate tax evasion scheme by importers under the guise of the export promotion scheme which has resulted in a staggering loss of Rs27.5 billion to the national exchequer.
Roughly 1,268 importers falsely claimed duty and tax exemptions between 2014 and 2022, totaling imports worth Rs. 27.5 billion. These importers failed to fulfill directives outlined in SRO 492 for re-exporting the imported goods.
Notably, SRO 492 grants importers tax waivers on the condition that the imported goods are re-exported within 18 months. However, PCA South’s audit has exposed a blatant disregard for this stipulation by the importers.
Of the identified 1,268 importers, 764 fall under the jurisdiction of PCA South, while PCA Central oversees another 645, with the remaining 164 under PCA North.
Authorities at PCA South have initiated legal proceedings against the fraudulent importers, including the encashment of security deposits made during the import filing process. Efforts are underway to swiftly conclude proceedings and penalize those responsible.
Tax experts have emphasized the importance of such stringent actions in sending a clear message to traders regarding compliance with customs regulations. They have also stressed the necessity for policy reforms in export schemes to mitigate the risks of large-scale fraud, especially amidst the current economic challenges faced by the country.
Experts advocate for long-term solutions that discourage exploitative practices to preserve the national treasury from further financial losses.
