KARACHI: The Directorate General of Customs Valuation has revised the customs value of chewing gum through Valuation Ruling No 1000/2016 under Section 25A of the Customs Act, 1969.
According to details, customs values of the subject chewing gum were determined and notified vide Valuation Ruling No.834/2016, on April 19, 2016. Since prevailing customs values mentioned in the said valuation ruling are more than two years old, therefore, the customs values therein need to be revised in view of the current trends of international price. A meeting to determine the customs value of chewing gum was held on December 8, 2016 which was duly attended by all the stakeholders.
All the stakeholders strongly contended and requested that the existing valuation ruling may be reviewed in the light of prevailing international and local market prices.
It was also highlighted that the subject goods are perishable items and therefore have a limited shelf life, consequently, around expiry dates, these perishable items are sold on sale and discounted prices. It was further contended by the traders that since the subject goods are mainly being sold on super and general stores, therefore, a lot more expenses (shelf rent, marketing expenses, refrigeration cost etc.) are contributed at retail level which cannot be managed without adding extra value to the subject goods. The importers contended that all these factors may also be considered in fixing value of subject goods. Prices are also verified on the basis of location of the markets.
Valuation methods provided in the Section 25 of the Customs Act, 1969 were duly followed and applied sequentially to address the valuation issue at hand. Transaction value method provided in Sub-Section (1) of Section was found inapplicable because it is generally known to all that majority of invoices reduced at import stage are manipulated/fabricated and hence the requisite information required under the law was not available to arrive at the correct transaction value.
Identical / similar goods value method provided in Sub-Sections (5) & (6) of Section 25 ibid were `examined for applicability to determine customs value of subject goods, this data provided some references, however, it was found that the same cannot be solely relied upon due to the ‘absence of absolute demonstrable evidence of qualities, and quantities of commercial level etc., and also it was observed that same importers provide misleading description while declaring goods, as other types and varieties of similar goods to avoid the application of valuation ruling.
Information available was, hence, found inappropriate. In line with the statutory sequential order of Section 25, this office then conducted a market inquiry using deductive value method under Sub-Section (7) of the Section 25 of the Customs Act, 1969.
