KARACHI, Feb 25: The huge influx of smuggled Iranian tiles has hit the local industry which is already facing difficulties due to cheap Chinese tiles available in the market. The local industry has informed the Chairman Federal Board of Revenue (FBR) Ali Arshad Hakeem that Iranian tiles were easily available in Karachi, Quetta, Makran, and other markets at 35-40 per cent lower rates than locally produced tiles. Meanwhile, the markets are also flooded with imported tiles, including cheap Chinese tiles that are some 20-25 per cent cheaper than local ones. Chief Operating Officer Shabbir Tiles and Ceramics Limited (STCL) Raza Ansari told Dawn on Monday that imported, smuggled and under invoiced tiles hold at least 45 per cent market share while the share of local industry hovers between 50-55 per cent. He said that for the last five to six months the presence of Iranian tiles has increased tremendously in the local markets. “Iran has been facing US sanctions and hence it is dumping its tiles in Pakistan. The Iranian tile-making units enjoy subsidised gas and on the contrary, our local industry is either not getting gas or at higher rates,” Ansari said. He further said that Chinese tiles were arriving under the FTA under 20 per cent duty while customs duty on import of tiles is 35 per cent, adding: “Heavy under invoicing on Chinese tiles has been going on.” “International tiles prices hover between three dollar to 30 dollars per metre and these find way into the local market after heavy under invoicing,” he added. Two other leading tiles producers also informed the FBR on February 20 that the local industry faced stiff competition as Chinese tiles were finding way into the market due to misdeclaration of sizes and quantities in order to avail lower customs duties that are based on import trade prices (ITP). They said in case of Iranian tiles, no duties and taxes have been paid and therefore vast quantities are available in the markets. They said that demand of local products has become lower due to huge price difference. Iranian tiles are more than sufficiently meeting demand of the people thus making survival of local industry difficult. They said due to decline in locally produced sales, the government is losing large amount of revenues which it receives by way of taxes from the industry. The local manufacturers informed the FBR that Iranian tiles are arriving through Taftan border in exchange of agricultural or other items available from Pakistan under barter system. They said the smuggling of Iranian tiles should be stopped immediately. Exporters and importers involved in this trade should be categorically directed to export their goods through Form-E and remittance in US dollars may be ensured. They said imports should be allowed through confirmed letters of credit through proper channel so that due amount of duties and taxes may be evaluated and recovered at the import stage. They urged FBR to take immediate steps to ensure recovery of due amount of customs duties and taxes at import stage on import of tiles from Iran. The barter system of trade should be banned.