Customs tariff structure review suggested for removing anomalies

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KARACHI: Pakistan Business Council (PBC) has urged the Federal Board of Revenue (FBR) to review the customs tariff structure to remove anomalies. The problem has become acute with the imposition of regulatory duties.
In its proposals for budget 2018/2019, the PBC said that in an effort to raise revenue, the customs tariff in the past few years has moved from one which supported a cascading structure to one in which finished goods have a lower tariff as compared to raw materials and intermediate goods.
The PBC suggested that duty on plant and machinery should be reduced to zero to increase industrialization. Further duty on imported coal should also be reduced to zero to promote competitiveness of local industry.
It said that presently plant and machinery is subject to three percent customs duty. Similarly, coal of high BTU value not available in the country is subject to five percent duty.
The PBC highlighted that misuse of Afghan Transit Trade (ATT) is a major issue for companies in the formal sector; whether in manufacturing or imports. It suggested that full government levies need to be collected for Afghan shipments transiting Pakistan with refunds being issued once shipment cross over into Afghanistan.
Further, Afghan government duties / levies should be collected at Karachi and deposited into the accounts of the Afghan government.
It further recommended that in addition, quantity as well as consumption parameter should be enforced to ensure that Afghan imports reflect consumer preference. Industrial imports should reflect the existence and level of development of Afghan industry.

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