PESHAWAR: Although the time period for exemption from Customs duty in Malakand division has expired, officials have ruled out the possibility of seizing non-custom paid (NCP) vehicles in near future owing to shortage of manpower and resources.

Officials told this scribe that although NCP vehicles were supposed to be seized and confiscated since the time period for tax exemption expired, yet Customs department was not in a position to take action right now since it was short of infrastructure, manpower and other resources.

“Customs has no presence in Malakand division, an area with a bulk of NCP vehicles as compared to other parts of the recently merged districts,” said a senior official. He added the vehicles were required to be impounded by someone and then parked somewhere but it was not possible at the moment.

“I don’t say this will not happen but I don’t think this is going to happen in the near future,” he said.

Officials say dept short of infrastructure and manpower to seize these vehicles in Malakand

Officials, privy to the developments, said that although NCP vehicles were available and being used by locals in the erstwhile Federally Administered Tribal Areas (Fata) and Provincially Administered Tribal Areas (Pata) of Malakand division, they believed that more than 60 per cent NCP vehicles were in Malakand division.

They said that in 2018, the then government decided that duty-free vehicles would be allowed in the region for a period of five years, ending on June 30, 2023. They said that such vehicles were restricted to Fata and Pata territories. It was also decided that on expiry of the duty date those vehicles could be regularised on payment of duty and taxes, they added.

Amendments, however, were made to Sales Tax Act by the last Pakistan Democratic Movement (PDM) government and exemption from Sales and Income Tax in Fata and Pata was extended for further one year till June 2024.

Locals have expressed concerns over possible seizure of NCP vehicles. However, officials said that it was an extension of exemption from Sales and Income Tax only and that it had nothing to do with Customs duty.

“Since extension in exemption has nothing to do with Customs duty, all these NCP vehicles, which we believe are around 0.4 million across the province with majority in Malakand Division, are liable to be seized and confiscated,” a senior Customs official told Dawn.

He said that a small fraction of locals used luxury vehicles but for more than 90 per cent residents of Malakand division, it was the only mode of transportation and for most the sole source of income.

When asked, Collector Customs Enforcement Khwaja Khurram confirmed that most of NCP vehicles in the province were present in Malakand division. He said that there was no mention about extension of exemption from Customs duty. “A collective decision will be taken by all the stakeholders and then Customs department will be in a position to implement the decision,” he added.

Malakand Commissioner Saqib Raza Aslam, when contacted, said that the issue should have been resolved. He said that extension in exemption was only from Sales Tax and Income Tax and not from Customs duty. “The federal government will make a decision. We will implement any decision made by the federal government,” he added.

Published in Dawn, October 20th, 2023