ISLAMABAD, May 19: The tax authorities are considering a budgetary proposal to work out measures for countering practice of under-invoicing, dumping and smuggling of goods causing losses to the local production.

A senior official told Dawn on Monday the proposal was under consideration following the recommendation of the Ministry of Industries and Production and the relevant stakeholders. The relief measures would be announced in the forthcoming budget for 2003-04, said the official.

It was observed that the practice of dumping, under-invoicing and smuggling caused around Rs10 billion loss annually to the national exchequer. It also affects the production of local industries.

The official said the measures would mostly include reduction of import duty on raw materials of those items which were prone to smuggling, under-invoicing and dumping.

The budgetary committee has also been assigned the task to work out a list of those items prone to these practices with the assistance of relevant stakeholders.

The committee would also consider the proposals of reducing the input cost of production due to which the Pakistani products have become uncompetitive in the local and international markets.

These proposals mostly included reduction in the electricity and gas tariffs, particularly for the industrial sectors, said the official.

With reduction in the input cost, the official said it was estimated that the practice of smuggling, dumping and under-invoicing would reduce to a great extent.

According to an official report, at least 18 items of smuggling were causing a net loss of Rs262 million annually. The items which are being smuggled back into Pakistan include — kitchen ware, bicycles and spare parts, battery cell, pad-locks and tin ingot, cosmetics, desiccated coconut powder, bulb and tube lights, mixer, Nitto tape, toiletries, tooth paste, food stuff processed, chewing gum, blanket, black tea, toys, black pepper, vacuum flask, sewing machine, baby pampers, shoe polish, tools, footwear, betel nut, tiles, lack dana (seed lac), almonds (bada- dry fruits), small cardamom, vehicle of all kinds (except for left hand driving), gas heaters, cigarettes paper/filter rods and sugar.