KARACHI, Feb 14: Importers of plastic toys have criticised the customs for suddenly enhancing valuation rates for determining customs duty on all categories of toys.

It is being apprehended that this move will open floodgates of smuggling, and imports through official channels will come to an end.

The directorate-general of customs valuation in a circular on Jan 26, 2008, had directed all collectorates to assess and determine customs value of all categories of plastic toys under new the valuation based on value of raw material plus manufacturing cost and freight.

The new valuation of plastic toys had been prepared on receiving a reference from the Collector of Customs, Model Collectorate of Customs (MCC), regarding valuation of toys on the basis of cost of raw material used therein.

According to importers, the rise in valuation and assessment rates on imported toys based on raw material prices and other manufacturing inputs had been made unilaterally by the customs and no stakeholder was taken into confidence prior to making such an unrealistic decision.

The directorate of customs valuation enhanced the assessment and valuation on toys after finding an abnormal valuation trend in the range of $0.758 per kg to $.0918 per kg which is even lower than the raw material used in the manufacture of toys.

The authorities also claimed that several meetings were convened to share these findings with the stakeholders, and barring a few importers, a majority of them abstained.

Under new valuation rates, the minimum rate has been fixed at $2.50 per kg and highest at $15 per kg. However, importers argued that it is sure that the raw material prices were not the consideration while fixing the value, otherwise, the fixed values would not have been more than $1.50 per kg as suggested by the Collectorate of Customs.

The manufacturing cost and other over-head charges, importers challenged, would not go beyond $1.50 per kg under the prevailing price of toy.

Furthermore, the collectorate also confirmed that the assessable customs value should be at $1.50 per kg for a non-battery operated toy and $1.75 for a battery-operated toy.

The importers alleged that it was evident from the record that four leading importers of toys were never invited to meetings called by the customs authorities prior to increasing valuation prices on import of toys.

They also said that saleable prices of toys in the local market are much lower than the ascertained prices in the new valuation ruling.

The prices have been arbitrarily enhanced without taking stakeholders into confidence.

The importers claimed that toys imported from China were of average quality and were being sold at common markets whereas price valued by the customs authorities was of superior quality.

The prices taken by the customs authorities are from retail and posh area markets rather than wholesale markets.

Above all no joint market survey had been conducted as it should have been deemed to include trade representatives and importers.

Importers of toys further said that import of toys varies with many factors, like quantum of imports, terms and conditions of payments, availability of stocks and other business terms.