KARACHI: The Directorate General of Customs Valuation, Karachi, notified the changes through Valuation Ruling No. 2064/2026, replacing the earlier framework issued in 2020. The updated ruling will be used by customs authorities to determine duties and taxes on imported engine components and related spare parts.
Officials said the revision was initiated after formal representations from industry stakeholders, including importers and automotive sector participants, who highlighted significant shifts in international pricing and supply chain dynamics. The FBR noted that the earlier valuation system had become outdated due to changing global trade conditions.
A consultative session held on February 24, 2026 included representatives from the Pakistan Automobile Spare Parts Importers & Dealers Association and Indus Motor Company, who provided input on pricing structures, engine capacity segmentation, and market trends. These inputs were incorporated into the revised valuation methodology.
Updated valuation methodology
According to the ruling, auto parts pricing varies significantly based on engine capacity, product origin, and quality standards. To address inconsistencies, the FBR refined engine capacity categories to improve accuracy in customs assessments.
Officials said traditional valuation methods, including transaction value and comparable goods benchmarks, could not be consistently applied due to incomplete import data and irregular pricing patterns.
As a result, customs values were determined under Section 25(9) of the Customs Act, 1969, based on market inquiries and available international price data.
The authority also noted that several components, including piston and ring sets, are typically imported as complete sets rather than individual units, which has been reflected in the updated valuation structure.
Selected customs valuation benchmarks (C&F, US$)
Part Type Engine Capacity China Japan Other Origins
Piston Set (LTV) Up to 660cc 2.88 3.65 6.06
Piston Set (LTV) 1000–1300cc 4.25 5.39 8.94
Piston Set (LTV) Above 3500cc 10.63 13.50 20.26
Ring Set (LTV) Up to 660cc 0.60 0.69 0.90
Ring Set (LTV) 1300–1800cc 0.93 1.08 1.41
Gasket (per piece) Up to 660cc 0.35 0.53 0.64
Connecting Rod 1000–1300cc 5.90 9.07 10.91
Connecting Rod Above 3500cc 14.63 22.50 27.06
Officials said the updated valuation is intended to ensure uniformity in duty assessment and reduce disputes between importers and customs authorities.
Market impact
Industry participants said the revision is likely to improve transparency in customs valuation but may increase costs for certain imported auto parts, particularly for higher engine capacity vehicles. Pakistan’s large stock of aging vehicles continues to drive strong demand for replacement components, making accurate valuation critical for revenue collection.
The FBR said the new framework reflects long-term trends in import pricing and is designed to provide consistency across customs stations nationwide.
All customs collectorates have been directed to strictly implement the revised valuation ruling. In cases where declared invoice values exceed benchmark customs values, the higher value will be used for duty assessment. Adjustments will also be made for air-freighted consignments to align them with sea freight pricing standards.
The ruling will remain effective until further revision or withdrawal, providing a standardized benchmark for imported auto parts valuation across Pakistan.
