PESHAWAR: After repealing extension of Customs Act 1969 to PATA, the customs authorities have no legal power to check non-duty paid smuggled vehicles and other smuggled goods in Provincially Administered Tribal Areas (PATA).
Experts said that the President of Pakistan had repealed the extension of Customs Act 1969 to PATA. Resultantly, powers of the customs department to exercise powers of Customs Act 1969 within the territorial jurisdiction of FATA have been withdrawn. It is apprehended that the measure would promote smuggling in the country.
Following withdrawal of Customs Act from the FATA, the customs cannot seize any smuggled goods or make contravention report against the smuggled items within the territorial jurisdiction of FATA. Secondly, customs department cannot impose duties and taxes on the smuggled goods supplied/sold in FATA, former top customs official/expert said.
Previously, customs was empowered to seize smuggled vehicles within the area of FATA. Now, there would be no check on movement of smuggled vehicles, except if intercepted by customs while entering into the tariff areas of Pakistan. At the same time, the goods manufactured in FATA cannot be brought to the tariff areas without payment of duties and taxes. Such goods are liable to duties and taxes when moved to tariff areas of the country, customs experts added.
The decision would also have implications over the imports made by the manufacturing units located within the jurisdiction of FATA.
For example, steel melting units established in PATA, Dargai and Mardan are exempted from sale tax and income tax, but they are bounded to sell their products within the limited areas of FATA. The withdrawal of Customs Act would also benefit such units from enforcement powers of customs department. If customs cannot operate in FATA, but they have to ensure that any non-duty paid products be subjected to duties and taxes when brought into the tariff areas of Pakistan.
According to the functions of the Collectorate of Customs Peshawar, as specified in the FBR website, the whole of NWFP and Federally Administered Tribal Area (FATA) except Provincially Administered Tribal Area (PATA) form its jurisdiction.
It is worth mentioning that on 15th May 2015, Chief Minister KP requested to extend Customs Act 1969 to PATA. Later, the KP government moved a summary for extension of Customs Act, 1969 to PATA in light of the recommendations of Apex Committee. The President of Pakistan approved the request and notification was done on 28th March 2016. The people of PATA protested.
SAFRON ministry forwarded a summary moved by the KP government of 5th May 2016 which recommended that the President of Pakistan may approve repealing the extension of the Customs Act 1969 to PATA due to economic situation and poverty of the region.
During the budget session several parliamentarians from KP and FATA requested for the repeal of the Customs Act in the region.
Finance Minister promised in the budget session to place the matter before the Prime Minister on his return from abroad. Later on advice of the Prime Minister the President of Pakistan had repealed the extension of Customs Act 1969 to PATA.