FAISALABAD: The Federal Board of Revenue (FBR) officials said that Custom Duty has been relaxed on a car import categorized as gift, personal baggage and an import made under the Residence Transfer Scheme.
This exemption has only been granted to cars imported between 4th of December 2017 and 9th of January 2018. The importer can only avail this relaxation if he proves that the respective payment to import the vehicle has been made from a bank account owned by a Pakistani national.
Retrospectively, around 6,000 vehicles were imported without any proper bank details. These vehicles have been stopped at the ports so that the Custom Department can apportion relative payments and exact them.
The relaxation may help importers to get around 4,000 cars cleared out of total 6,000 currently stuck at the ports.
However, under the new law, the importer had to show proof of payment using remittances in order to get the vehicle cleared. The Ministry of Commerce and Textile made a proposal to levy custom duties on imported vehicle, specifically those falling under Transfer of Residence Scheme, Personal Baggage, or Gift Scheme categories.
The proposal further stated that this remittance shall be exacted only if the payment is made from an account of a Pakistani national, either a local bank’s account or from the ordering Pakistani family’s member’s account in case the primary payer’s account is inoperative or non-existent.
Due to this policy change, about 6,000 orders made through bank accounts with improper details had to be halted to receive the respective payments.
Following Pakistan Customs advice, the FBR exempted tax on the aforementioned categories of imports in order to help clear these 6,000 vehicles stuck at the ports.
Reportedly, these 6,000 imports were made before 9th of January, 2018 which is why this timeframe has been selected.
In a letter, the Model Customs Collectorate (MCC) suggested the FBR to evolve a better mechanism to deal with the payments on such imports, specifically the orders which were made before 9th of January.
