All Pakistan Motorcycle Spare Parts Imports and Dealers Association reject upward revision of assessment of imported goods valuation
Karachi, December 11, 2013 (PPI-OT): All Pakistan Motorcycle Spare Parts Imports and Dealers Association (APMSPIDA) rejected sudden upward revision of assessment of imported goods valuation and demanded of the government to revert it to previous level.
They termed the increase to bring wave of price increase of essential goods besides encourage smuggling of the products.
The importers are reluctant to clear their imported consignment from ports due to sudden higher assessment of goods.
In a letter to Federal Finance Minister Ishaq Dar, Senior Vice Chairman of APMSPIDA, Khurram Riaz, Former Chairman Faisal Khalil, Rehan Haneef and Nasir Maqbool said they received a list of 96 items as criteria for revised assessment of imported goods which include Sr No 58, 80, 85, and 86 belonging to motorcycle spare parts.
He said motorcycle parts fall u/h 8714.1020. The tax regime on H.S. code 8714.1020 is total worked as 100 percent of customs value (i.e. CD including add, duty plus 50 percent, Sales Tax 17 percent, additional sales tax 3 percent, income tax 5.5 percent, plus 8 to 9 percent overhead expenses). This is the highest tax rate and in result it attracts smugglers as a favorite dish as compared to all other items of Pakistan customs tariff.
He pointed out that major portion of metal parts manufactured from CRC (mainly secondary quality) metal sheet which is used as raw material for their parts and lighting equipment contain some glass material and both the materials are not more than 450 dollars to 550 dollars per M/ton range and after adding manufacturing cost which is not more than 25 to 30 percent; if finally worked out as 725 dollars per M/ton for finished product. The assessment criteria were 1.10 dollar per kg which was also enhanced to 1.20 dollar during last year.
The senior vice chairman said at present around 80 percent of motorcycle spare parts is routed on legal way through Federal Board of Revenue (FBR) channel in which government earns a revenue of approximately two billion rupees yearly. Rest 20 percent trade which contain carburettors, CDI unit, crank case and break hubs, etc., which are being assessed 4.50 dollars, 3.00 dollars, 3.73 dollars and 2.33 dollars per kg (as per valuation ruling) and are not on the legal import channels due to their higher valuation rates which are almost double of the automobile (4wheel parts).
He said some items which are very heavy in weigh such as spokes, chains and chain sprockets and are being assessed below the criteria should be maintained as per prevailing date available, as they are most attractive items for illegal channel because of their heavy weight and low CBM.
Khurram Riaz expressed fear if the present assessment criteria will be enhanced, most of the items will shift through illegal channels. This will not be the good sign for economy resulting in a heavy loss to government revenue in future.
He further pointed out that due to the sudden increase in assessment without the consent of stakeholder imports are facing heavy loss in items of demmurage, detention and loss of sale.
Major imports have stopped their shipments which will result not only panic in market of Pakistan, but also will result major shortfall in government revenue.
Meanwhile, Chairman Pakistan Chemical and Dyers Merchant Association (PCDMA), Shokat Riaz has also rejected the customs new clearance guidelines of imported goods and demanded valuation on imported goods on price certification.
He said the imports are reluctant to clear their imported consignment from ports due to fixing valuation and at exorbitant higher rate.
He met the Chief Collector Customs and apprises him about the concern of PCDMA members and said customs authorities clearing goods at fixed value under the guide which is extremely higher.
The chief collector assured him of all possible support and advised him to meet additional collector and apprise him of their concern and give proposals.
Shokat Riaz also met additional collector Fayaz Rasool and apprised him of imports objection and said the imports are not prepared to accept increase in valuation.
He said the guide include majority of items which are used as industrial raw material and if this valuation is implemented the cost of manufacturing will go up tremendously.
He expressed that manufacturers will defiantly pass increase to consumer’s end that are already under heavy financial crisis.
For more information, contact:
All Pakistan Motorcycle Spare Parts Importers and Dealers Association
Room # 60, Aurangzeb market
M. A. Jinnah road
Category: General Business News