Massive underinvoicing detected; Pakistan Customs estimates losses of billions of rupees KARACHI: Pakistan Customs has detected massive underinvoicing in various products where the declared value was less then the minimum average value. The customs authorities estimated billions of rupees loss to national exchequer through undervaluation of goods in which the entire chain of clearance process is involved. The sources said that the Federal Board of Revenue (FBR), the parent organization of Pakistan Customs, has initiated investigation in this regard and would ask the importers to pay the evaded amount. The sources also said that the officers chain at assessment hall are involved in government loss as examiners and appraisers cleared under valued goods after having their share. Similarly, at the next stage or first review the principal appraisers, ACs and DCs have also been found involved in the illegal practice. The sources said that Pakistan Customs is reluctant to take action against their officers because the action would result to suspension of about 80-90 percent posted at those places. Here are some goods where the declared value were lesser than the minimum value: gum, chocolates, confectionary, tang powder, dyes, paints, stamping foil, toner, mixture of odoriferous substance, agricultural pesticides, textile chemicals, mixture of fatty acid, textile chemicals etc. Regarding the import of plastics the customs authorities said that examples taken from the plastic articles classifiable under Chapter 39. The overall studies of the chapter reveals that the declaration made under this chapter are as much under-invoiced that the declared value even did not coincide the cost of raw material utilized in the manufacturing of article. Further while declaring quantity, the goods, quantity is usually declared in number of pieces instead of the tariff in order to get a chance of assessment on lower side. Proposed average value is applicable, where valuation ruling is not involved. The plastic items involved: plastic needles, sheets, acrylic sheets, polycarbonate sheets, plastic water bottles, boxes cases crates, ware tank, door, window frames, plastic jewelry. The customs authorities detect about 64 HS Codes where goods were grossly misdeclared and some of those goods were suggested to be reconsider for valuation. The loss in duty and tax evasion is estimated at about over Rs600 billion per year and present FBR chairman Tariq Bajwa after assuming the charge had taken strict action to root out corruption from the revenue department. The nexus of FBR officials and trade community is still going on to cause immense revenue losses to the country. The lower revenue collection has not only widened the fiscal deficit but also the tax to GDP ratio is stagnant to between 8-9 percent for the last over one decade.
Posted on: Tue, 15 Oct 2013 04:40:40 +0000
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