KARACHI, May 10: The Central Board of Revenue (CBR) has decided to release over 1,000 commercial vehicles, including trucks and buses, seized by the customs authorities following issuance of SRO 255(I) on March 17, 2007.
All those vehicles shipped and loaded prior to the issuance of the SRO would be released after paying duty and taxes along with fine.
The Prime Minister’s Secretariat issued directives to the CBR chairman on May 9 to release those vehicles shipped prior to the decision of the Board of March 17.
The CBR on Thursday directed the customs authorities to release commercial vehicles, including trucks and buses, which had been shipped and loaded up to March 27, 2007. However, the board has asked the authorities to fulfil all legal requirements by seeking bill of lading, Goods Declaration (GD) showing engine and chassis number of vehicles, export general manifest (EGM), and carrier bill of lading.
Prior to the issuance of the SRO of March 27, 2007, all categories of vehicles, including cars and heavy duty commercial vehicles, such as trucks and buses, were allowed to be imported under Transfer of Residence (TR), personal baggage and gift scheme on paying 30 per cent fine at customs stage.
However, the SRO 255(1) of March 17 excluded the import of buses and trucks in CBU (complete built unit) condition and chassis. Despite the fact that the import policy disallows import of old and used vehicles, but the government through SRO-574 dated June 6,2005, granted permission to individuals to import private and commercial vehicles on paying fine.
Eversince the issuance of SRO 255(1), over 1,000 vehicles have been detained or seized by the customs authorities at different terminals, including Al-Hamad (off-port terminal), KICT, PICT, PQA, and KPT. Similarly, different customs collectorates, such as Model Customs Collectorates, Appraisment and preventive, working at different terminals have held back these vehicles.
Nevertheless, importers and individuals who imported these vehicles without getting a single dollar from the national exchequer will immensely suffer on paying, besides, taxes and duties, huge amount towards port demurrage. All such vehicles are funded by overseas Pakistanis as they provide required foreign exchange.
The government on its part will get its revenue which is being estimated at around Rs5 billion because each vehicle cleared by the customs will have to pay 30 per cent customs duty, 15 per cent sales tax, six per cent income tax (withholding tax) and 30 per cent fine of the assessed value.
Consequently, the ultimate loser would be individuals who imported these vehicles as they will have to pay huge amounts towards port demurrage because after the unloading of consignments from ships the port authorities do not charge demurrage for first five days but subsequently Rs1,200 per day is charged for first 10 days and Rs2,400 per day for another 10 days and Rs3,600 per day for following 10 days.
After a period of one month, demurrage at a fixed rate of Rs4,500 per day is charged.
However, if an importer manages to remove his vehicle from port and shift it to bonded warehouse, Rs10,000 per month is charged which goes into CPF (customs personal fund).
In case the vehicle is in a container, the importer will further suffer because he/she will have to pay rent for 20ft box at $5 to $7 per day and $12 to $15 for 40ft box.
The CBR’s SRO of March 17, 2007, may have helped the ports and terminals to make more money through higher demurrage, but for sure it has made colossal losses to individual imports, asserted Abdul Ghaffar Bhundi, chairman, Karachi Customs Agents Action Committee. Some months back a similar game was played with dumper trucks as they were also seized by the customs on some pretext or the other which helped the customs to earn around Rs70 million towards CPF and around Rs50 to Rs60 million must have been made on holding back of over 1,000 commercial vehicles, like trucks and buses, he maintained.
