THE country’s top tax authority seems to have run out of good ideas. According to news reports, the Federal Board of Revenue first proposed, then withdrew new baggage rules for visitors travelling from abroad that could have potentially caused a lot of unnecessary inconvenience to ordinary people. According to the proposed regulations, the FBR had suggested that anything travellers brought into the country that was deemed to be ‘for trading purposes’ and was valued at more than $1,200 would be seized by customs authorities. Such goods, once seized, would also not be released, even if the affected party was willing to pay customs duties, taxes and fines, the proposal stated. The proposal further suggested that travellers should not be allowed to bring in more than two phones — one for personal use and one additional — and even the additional phone would be released only on payment of duties and fines.

Why this proposal was floated defies understanding, considering that its aim was not to enhance revenue collection. The FBR seemingly believed these measures would help curb smuggling, but the truth is that very similar measures in the past have already failed to make a meaningful dent in the ‘khepia’ racket. The khepia smuggling networks have continued to thrive because they operate in connivance with corrupt individuals within the administrative machinery, for whom such regulations mean nothing. Secondly, the proposed regulations placed too much arbitrary power in the hands of customs officials. If the purpose of the goods and their value was to be fixed based on ‘prima facie’ assessments, as the proposal suggested, this would have exposed ordinary travellers to being harassed during luggage checks and faced with the possibility that their precious luggage could be seized merely on an individual’s assessment. Additionally, considering these measures were floated at very short notice before the winter holiday season, there was bound to be much commotion at airports as unaware passengers faced off with airport officials over the rules. It appears that, as the pressure grows on the tax authority to meet its targets, it wants to give the impression that it is thinking outside the box. However, targeting travellers coming to the country was no solution to the massive problems it faces. The FBR would be better served by targeted action against smuggling networks and weeding out bad actors within its ranks.

Published in Dawn, December 11th, 2024