Clearing customs

The FBR chairman held a meeting recently to determine the reason for reduction in amounts of customs duty collected at the import stage. It is well-known that the annual value of our declared imports from China is $3 billion less than the value of declared exports to Pakistan from China (resulting in a loss every year of $1.5 billion, or nearly Rs150 billion, in evaded duty and taxes). So it is very easy for the FBR to improve revenue collection substantially. 

The FBR should arrange with the Chinese customs authorities to inform Pakistan customs the value of each consignment exported to Pakistan (before the consignment reaches a Pakistani port). The importer will then be compelled to declare the true value to the customs, and misdeclaration and under-invoicing will automatically end. Similarly, containers of goods brought from Dubai to Pakistan should be thoroughly checked and duties/taxes imposed accordingly. At present, such containers can easily be cleared on payment of nominal duty and Rs25,000 under the table to customs officials.

Shakir Lakhani
Printed in The News, April 15, 2014