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PAkiSTAn’S FiRST inDEPTh nEwSPAPER On CUSTOMS
26 AbC Certified vol 75 issue no. 18
weekly weekly
karachi, Tue Dec 25 - Mon Dec 31, 2018
Regd. no, MC-1381
inCREASinG TAx nET ISLAMABAD
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Hammad Azhar says number of taxpayers increased by 30% in a year and FBR issued notices to further 20,000 non-filers. | SEE PAGE 12 | REviSinG vAlUES
DG Customs Valuation Surriya Ahmad Butt revised values of French fries through VR No. 1308/2018. | SEE PAGE 03 |
Ongoing anti-smuggling campaign by Multan Customs paved way to generate more revenue, says Collector AmbreenTarar | SEE PAGE 06 | FOilinG SMUGGlinG biD
CustomsIntelligencefoiledan attempttosmuggledi-ammunium phosphate(DAP)fertilizerto Afghanistan. | SEE PAGE 04 |
— Exclusive Customs Today photo
GEnERATinG REvEnUE
ederal Minister for Finance, Revenue and Economic Affairs Asad Umar has said that the government is restructuring the tax system to increase tax net. He said this while addressing a summit of women entrepreneurs, organised by Rawalpindi Chamber of Commerce and Industry (RCCI) recently. The Qinance minister said that all the initiatives in Federal Board of Revenue during the last four months were taken to enhance the tax net. Meanwhile, the Federal Minister, chairing the Qirst meeting of Steering Committee, approved key decisions for enabling the FBR’s Customs Wing to ensure timely implementation of the ‘National Single Window’ system in Pakistan. Lauding efforts of the FBR in leading this important program, the minister stressed that the customs project team should not merely rely on technology deployment but also adopt holistic approach in simplifying the complex regulatory regime and allied laws to meaningfully improve trading across border regime in Pakistan. The meeting was also attended by Federal Secretaries from all key ministries and FBR ofQicers. The ‘National Single Window’ system would emerge as the overarching umbrella for automating public sector entities dealing with cross-border trade providing an integrated single interface with private sector to carry out imports, exports and transit trade. This will substantially improve Pakistan’s ranking in ‘Ease of Doing Business’ besides enabling Pakistan to comply with its commitment under the Trade Facilitation Agreement of the WTO. The National Single Window to be known as ‘WinPak’ (Window Pakistan) will help to develop the country’s initiative for its electronic logistics platform, which the Finance Minister said should be done within the next three years. ‘WinPak’ will link all key cross-border trade-related
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regulatory authorities including Customs WeBOC on a single ICT based platform. The connected government approach will improve transparency and predictability in imports and exports while cutting down costs/time, both for the public and private sectors. The much-needed port community system will also be established to improve the efQiciency of sea and airports in Pakistan under this project. Not only Government to Government (G2G) and Business to Government transactions will take place on this new platform but it will also facilitate all Business to Business (B2B) transactions. Meanwhile, the Finance Minister said that the government will control Pakistan state enterprises through establishing a new holding company “Sarmaya-e-Pakistan Limited (SPL)”. Replying a question of PPP Member National Assembly NaQisa Shah, Asad Umar stated that government is working on a strategy to revive Public Sector Enterprises (PSEs) through prudent policy measures. In order to revive these entities, a multidimensional strategy has been adopted that will address management restructuring, bringing in dynamic and experienced board composition along with professional and technical oversight of the working of PSEs. After detailed deliberations, it has been decided that PSEs will be gradually taken out from the administrative control of ministries/divisions and shall be placed with a new holding company namely “Sarmaya-ePakistan Limited (SPL)”. The SPL shall be managed and controlled by skilled professionals and its board shall comprise of eminent persons from diverse Qields.
‘National Single Window’ system would emerge as the overarching umbrella for automating public sector entities dealing with cross-border trade
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NATIONAL
DeCeMBeR 25 - DeCeMBeR 31, 2018
ShC calls comments on petition filed by M/s Diamond impex KARACHI:TheSindhHighCourt(SHC)hasdirectedcustomsofficialstofiletheirpara-wisecommentsonaconstitutionalpetitionfiledbyFaisalNaseem,ProprietorofM/sDiamondImpex Corporation,againstimpositionofregulatorydutyonconsignmentsofsweetcondensedmilk.Atwo-memberbench,headedbyJusticeAqeelAhmedAbbasi,heardthematter.Duringthe hearing,counsel for the petitioner stated in his constitutional petition that petitioner is aggrieved by the arbitrary,illegal and unconstitutional acts of the respondents,who had issued SRO568(1)/2014dated26/06/2014asamendedbySRO1177(1)/2015dated30/11/2015inpurportedexerciseofpowerunderSection18(3)oftheCustomsAct,1969imposingregulatory dutyonanumberofitemsincludingthesweetcondensedmilk,importedbythepetitioner,fallingunderchapter04ofthePakistanCustomsTariffbeingthefirstscheduletotheact,1969.
FBR chairman directs Chief Commissioners to maximise revenue collection
wb team visits islamabad Customs Collectorate to review performance
ISLAMABAD
ISLAMABAD
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ederal Board of Revenue (FBR) Chairman Mohammad Jehanzeb Khan has directed Chief Commissioners to maximise revenue collection during December 2018 to reduce the revenue shortfall accumulated during the first five months of 2018-19. The two-day Chief Commissioner’s Conference continued at the FBR House here on Wednesday. Through video links, tax authorities communicated with the Chief Commissioners of LTUs/RTOs. Through video conference, tax authorities have directed the Chief Commissioners of Large Taxpayer Units (LTUs) and Regional Tax Offices (RTOs) that the assigned monthly target for December 2018 must be achieved at any cost. During July-November 2018-19, the FBR has suffered shortfall of over Rs 100 billion. The FBR reviewed progress of enforcement action and recovery under various heads made by the field formations. The tax machinery is facing an uphill task to meet the ambitious revenue collection target of Rs 1,115 billion in the second quarter (October-December) of 2018-19. The government had downward revised revenue collection target of the FBR from Rs 4,435 billion to Rs 4,390 billion for 2018-19.
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FBR to adopt innovative strategy to expand tax net ISLAMABAD
MUhAMMAD FAiZAn www.customstoday.com
he Federal Board of Revenue (FBR) has decided to develop innovative strategy to increase the tax base. Sources told Customs Today that FBR would focus on big & flourishing businesses to bring into the tax net, including private hospitals, diagnostics, labs, pharmacies, eateries & food outlets, bakers, wedding halls, entertainment sector, event management concerns, professionals linked with showbiz, sports, drama, film, music and theatre, amusement parks & facilities, private educational institutions, especially joint ventures with international universities. Sourcestoldtherealestatesectorwitnessescountlesstransactionseachyear, (mostlyfallingoutsideformaltaxregime)is infestedwithconcealment,grossunderstatementandduplicatedocumentation.TheFBR intendstocollectinvestors’data,identify unregisteredpersonsandensurethatduetax ispaidbythem.Sourcesmentionedthat PakistanhasalsosignedMultilateralCompetentAuthorityAgreement(MCAA)andFBR hassuccessfullyexchangedinformationwith 39jurisdictionsinSeptember,2018.
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TARiQ DERYA
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Qive-member team of World Bank visited the Model Customs Collectorate (MCC) and held a detailed meeting with Collector ZulQiqar Ali Chaudhary, while Additional Collector Mohammad Ishfaq and Deputy Collector Wajid Zaman were also present on the occasion. Sources told Customs Today that during the meeting, the WB delegation was informed that the Federal Board of Revenue (FBR) has constituted a dedicated team to Qinalize a comprehensive proposal based on realistic assessment of HR for all the cadres of Customs service for effective performance of assigned duties to analyze existing and future functions, responsibilities, workload etc. Sources said that all these are required for their speciQic functions as well as increase in sanctioned strength of existing cadres for improvement of performance to be amalgamated in the desired uniQied proposal on the input provided by the Qield formations. World Bank team asked the Collectorate to provide HR details including numbers of new post proposed by the formation (all cadres), promotion path in case of new cadre/specialized by the formation, justiQication of expansion by supportive evidence/statistics wherever possible by the formation, estimated revenue enhancement due to proposed expansion, Qinancial impact of proposed post on annual basis, any other justiQication deemed appropriate by the forma-
— Exclusive Customs Today photo
CUSTOMS TODAY REPORT
tion, the source added. Meanwhile, Collectorate of Customs generated Rs13 million through auction of 10 luxury vehicles of Prime Minister House. Sources told Customs Today that it was the 3rd auction of vehicles surrendered by PM House during the last two months (November– December) of Fiscal Year 2018-19.
Collector Zulfiqar Ali Chaudhary
The sources said that the Prime Minister House handed over 49 old vehicles to MCC for auction. They added that the Collectorate sold nine vehicles during initial two public auctions held at State Ware House Islamabad in October and November Fiscal Year 2018-19. The sources said the Collectorate held public auction after advertis-
Customs Preventive starts crackdown against sheeshas C
KARACHI
MUbEEn hUSSAin www.customstoday.com
ollectorate of Customs Preventive, Anti-Smuggling Organization (ASO) has started crackdown against sheesha and its ingredients. According to the details, a team of Customs ASO under the supervision of Deputy Collector Headquarters Muhammad Faisal conducted several raids in different areas of the city to apprehend sheesha and its ingredients on the directives of the Supreme Court for the safety of the citizens and for the healthy environment. During the enforcement drive, two different raids were conducted at Dansow Hall and Empress Market Saddar and recovered 207 sheesha
weighting 129.5 kilograms, Qlavored charcoals etc. According to the ASO
team, the value of recovered sheesha and its ingredients is Rs249,000.
ing through banners and social media accordingly so the general public can participate in the auction process. The sources told that the Collectorate will hold another auction during the current month of December. They added that out of total 49, vehicles 19 have been sold, while 30 vehicles will be presented in next auction.
AGP unearths discrepancies worth Rs254b in tax receipts he Auditor General of Pakistan (AGP) unearthed variations of Rs254 billion in the figures of tax receipts, and referred to these as‘evasion’in the special audit reports of eight sectors for the 2017-18. The AGP has recommended various measures for the recovery of evaded taxes from the sectors along with fixing of responsibility. Those found responsible be proceeded against under the relevant disciplinary rules, the AGP recommended. The report will soon be placed before the Public Accounts Committee which is led by Mian Shahbaz Sharif. In a special report on input tax adjustment by independent power producers (IPPs), the audit report observations of over Rs10bn were related to Inland Revenue for 2014-15 and 2015-16. The loss of revenue is due to incorrect claims of exemptions. —CT Report
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NATIONAL 03
DeCeMBeR 25 - DeCeMBeR 31, 2018
Customs Court issues warrants against suspects booked in hSD smuggling case KARACHI: Customs Court issued non-bailable warrants against absconding suspects namely Amir Khan and Shamsullah Niazi,who were booked in a case of attempting to smuggle non-duty paid 10,000 liters HSD Oil.Investigation officer submitted interim charge sheet against the above named suspects and informed the court that during the search,a team of Customs Preventive intercepted a Hino water tanker bearing registration number:TUD-248 and Toyota Corolla car bearing registration number AJC922 and recovered 10,000 liters HSD oil.He further submitted that during the search, suspects Muhammad Anis Khan, Siraj Khan and Raaj Malook were asked to produce lawful documents, however, they failed to produce any lawful documents, therefore, they were arrested and goods and vehicles also were taken into custody.
Restrictions on late filers: FBR may lose over 300,000 tax returns
DG valuation revises customs value of potato frozen French fries
KARACHI
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KARACHI
wAQAR AhMED AnSARi www.customstoday.com
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irectorate-General Customs Valuation Surriya Ahmad Butt has revised customs values of French fries through Valuation Ruling No. 1308/2018. Earlier Customs values of potato frozen French fries were determined through Valuation Ruling No.1308/2018 dated 03-07-2018. However, various representations were received from the importers for re-determination of value of potato frozen French fries. Hence, an exercise was initiated by this Directorate General to re-determine the customs values of potato frozen French fries. Meetings with stakeholders, including importers and representatives from Qield formations, were held on 13-11-2018 and 6-12-2018. The importers contended that the customs values determined vide the exiting valuation ruling are high and therefore require fair revision in line with the prevailing prices in the international market. M/s. Venus Pakistan (Pvt) Ltd stated that the food prices of USA are considered to be the cheapest in the world as the US companies produce high quality products on large economies of scale thus reducing their costs. They also requested for the inclusion of their new brands namely Stealth fries, lamb seasoned, sweet things, lamb supreme, Pennat, Northwest Grown and Crusader Potatoes in the valuation ruling. M/s. Eximpo Cool Chains (Pvt) Limited, Karachi also requested for
— Exclusive Customs Today photo
he Federal Board of Revenue (FBR) may lose more than 300,000 income tax returns owing to the restrictions imposed on the late filers. The last date for filing income tax expired by mid-night Monday and the FBR was compiling the final numbers of income tax returns filed by the cut-o date. However, according to State Minister for Revenue Hammad Azhar, the total returns for tax year posted a healthy growth of 30 percent, increasing to 1.418 million, by December 15, 2018 compared to 1.121 million on the same date last year. The FBR sources said it was estimated that another 30,000 returns, including corporate returns due on December 31, 2018, would be added to the total number for the tax year 2018, bringing the total number of filed returns to around 1.45 million. Through Finance Act, 2018, a section 182A was introduced to Income Tax Ordinance, 2001, under which a return filed after due date will not be considered as eligible for entering the Active Taxpayers List (ATL). The appearance of name on the ATL is mandatory for availing reduced rate of withholding tax rates and also for qualifying to purchase immovable properties above Rs5 million and registration of locally manufactured or imported vehicles. The weekly ATL, issued by the FBR on Monday, showed that around 1.75 million returns had been filed for tax year 2017. If the FBR is able to receive 1.45 million returns for the tax year 2018, then they will be short by over 300,000 than the last tax year.
the inclusion of frozen Belgium Potato Fries of brand Mydible. During the meeting, all the stakeholders agreed that there is no signiQicant difference amongst most of the brands and requested that a ruling shall be issued keeping this factor in view. Valuation methods provided in Section 25 of the Customs Act, 1969 were duly applied in their regular sequential order to address the particular valuation issue at hand. The transaction value method as provided in Sub-Section (1) of Section 25, was found inapplicable
DG valuation Surriya butt
in light of the wide variations in declared values at import stage, requisite information required under law was not available to arrive at the correct transaction value. Identical / similar goods value method provided vide Sub-Sections (5) & (6) of Section 25 ibid were examined for applicability to determine Customs value of subject goods. Meanwhile, Customs Valuation Director General Surriya Ahmed Butt asked Director Valuation Iqbal Muneeb to review the Valuation Ruling No. 1191/2017 for removing deQiciencies in accordance with
law and also taking on board the regular major importers as well as the representatives of Federation of Pakistan Chamber of Commerce & Industries (FPCCI) and Karachi Chamber of Commerce & Industries (KCCI). According to the details, M/s K K Wooden Works agitated against Valuation Ruling No.1191/2017 that the department has not made the working/calculations properly while notifying the customs values of the One side Coated Duplex Board (grey, black 300 GSM and above and one side Coated Duplex Board.
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04 NATIONAL
DeCeMBeR 25 - DeCeMBeR 31, 2018
nAb court issues warrants against ex-chairman kPT Rauf Akhtar Farooqi KARACHI:The National Accountability Bureau (NAB) court issued bailable warrants against absconding suspect Rauf Akhtar Farooqi,ex-chairman Karachi PortTrust (KPT),who was booked on charges of corruption and abuse of authority for illegally appointing 940 employees in KPT.During the hearing on December 18,2018,the court was informed by NAB investigation officer that Rauf Akhtar Farooqi escaped after rejection of bail petition by a division bench of Sindh High Court (SHC).He submitted that prosecution is trying its best for his arrest and he will be produced when arrested.It needs to be mentioned here that proceeding for proclaimed offender Babar Khan Ghori,ex-minister of Port & Shipping are already undergone and court has issued his NBWs.
Peshawar i&i foils bid to smuggle DAP fertilizer to Afghanistan
M.b RAnA
www.customstoday.com /s Fazal Illahi & Sons and M/s Umer Ahsan & Co approached the Sindh High Court (SHC) for release of their consignments of imported copper tubes lying at port on submission of post-dated cheques. Counsel for the petitioners stated in his petition that the petitioners imported copper tubes from China which arrived on 2/11/2018 aboard vessel Wan Hai, and manifested dated 24/10/2018. He submitted that during the stated period, the Pakistani rupee was under immense pressure as foreign reserves of the country dwindled and Pakistan turned to IMF and China for a potential bailout resulting in devaluation of Rs11.70 a day from Rs124.27 per USD to Rs133.64 per USD. Since the petitioners’imports were denominated in USD as with most of the imports coming into Pakistan, such massive fluctuations in exchange rate impacted the survivability negatively of traders as the petitioners. He argued that petitioners filed goods declaration in which respondents had neither disputed nor disproved any documents submitted by the petitioners or the goods to be found contrary to what is declared, however, petitioners surprise, the respondents issued show cause notice against them, invoking provisions of Section 32 of CA, 1969, despite no sign of proof of false statement made, forged documents submitted, incorrect declaration made or neither taxes not levied or short levied, or have been erroneously refunded, presence of which are necessary for invoking and establishing penal provisions, and without giving ample opportunity for hearing to the petitioners, the respondents in haste, issued order-in-originals levying fine and penalty on the petitioners.
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Customs i&i Dr. Arsalan Subuctageen PeSHAWAR
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irectorate of Customs Intelligence and Investigation (I&I) team foiled an attempt to smuggle di-ammunium phosphate (DAP) fertilizer to Afghanistan. According to the details, Director Customs Intelligence and Investigation Dr. Arsalan Subuctageen received credible
information about smuggling of DAP fertilizer to Afghanistan under the grab of wheat Qlour. The anti-smuggling squad held a secret check-post near Badaber Kohat Road and started checking of vehicles. The customs team intercepted a trailer which was apparently loaded with wheat Qlour bags marked “for export only”. On the spot checking led to conQirm the presence of DAP. The trailer was, therefore, brought to the ofQice of Directorate of Intelligence and Investigation for thorough examination which
resulted in the recovery of 1013 bags of DAP each of 50 kilograms, total 50650 kilograms and 365 bags of wheat Qlour each of 47.500 total 17337.5 kilograms fertilizer. The customs team seized the fertilizer and trailer (goods Rs5.7 million and trailer 13 million). Customs team arrested the driver who was identiQied as Saleem son of Barat Gul and registered FIR No. 67/2018 while further investigations are still underway. It is necessary to mention here that Export of DAP fertilizer is banned vide the Export Policy Order.
GWADAR
MUbEEn hUSSAin www.customstoday.com
ustoms Gadani apprehended huge quantity of smuggled betel nuts and Indian origin gutka worth Rs11 million in a successful raid. The source informed Customs Today that the seizure took place at a check post Khurkhera in which 7 tons of smuggled betel nuts along with 40,000 pouches of Indian Gutka (RajGuru) were recovered. According to the details, Collector Customs Collectorate Gwadar Muhammad Yaqoob Mako received authentic information regarding the smuggling of contraband items through land route. On the directive of the Collector Muhammad Yaqoob Mako a team under the supervision of the Deputy Collector Customs Gwadar Ihsanullah Shah was constituted to bust smuggling attempt. The team of the Gadani Customs beefed up the surveillance and started checking different vehicles at the possible land route. During the surveillance and search of the vehicle, the team of the Gadani Customs intercepted a Hino truck bearing registration no: TKJ-573 and asked the driver for producing the legal documents which he failed to provide. A complete search of the Hino truck was conducted by the team of the Gadani Customs during which a huge quantity of smuggled contraband items was recovered. The recovered smuggled betel nuts and the Indian origin Gutka were being smuggled to Karachi from Quetta under sheep hides in a Hin0 truck.The total market value of seized goods is estimated at Rs 11 million in the international market, sources added. The driver of the said Hino truck was arrested and the recovered contraband items were taken into custody whereas the FIR was lodged for further investigation.
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Airlines responsible for delay in clearance of baggage: ADC nisar Ahmad C
ISLAMABAD
TARiQ DERYA
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ollectorate of Customs Additional Collector Nisar Ahmad Phularwal said that delay in clearance of baggage is due to the mismanagement of airlines instead of Pakistan Customs staff deputed at New Islamabad International Airport (NIIA). Talking to Customs Today, additional collector said that airlines are responsible for delay in clearance of passengers’ baggages. He added that he forwarded complaints to airlines many times but all in vain. He said that Customs staff at NIIA is performing their responsibilities professionally and once a baggage enters the arrival hall, the same is cleared swiftly.
— Exclusive Customs Today photo
KARACHI
— Exclusive Customs Today photo
M/s Fazal Illahi & Sons & M/s Umer Ahsan approaches SHC for release of consignments
Gadani Customs seizes betel nuts worth Rs11m near Khurkhera
www.customstoday.com DeCeMBeR 25 - DeCeMBeR 31, 2018
ADVeRTISeMeNT 05
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SPeCIALRePORT
— Exclusive Customs Today photo
www.customstoday.com DeCeMBeR 25 - DeCeMBeR 31, 2018
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SPeCIALRePORT 07
DeCeMBeR 25 - DeCeMBeR 31, 2018
MULTAN
iMRAn Ali khAn
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nti-Smuggling Organization was re-organized after assuming the charge of Multan Customs Collectorate and more anti-smuggling squads were deployed strategically in the jurisdiction to foil different attempts of smuggling. Special attention was given on revamping of Anti-Smuggling Organization (ASO) to curb the menace of smuggling. After these steps, Multan Customs showed exceptional performance by seizing a huge quantity of vehicles and goods worth Rs1017.545 million during various anti-smuggling actions from January to December 2018. These views were expressed by Collector Ambreen Ahmad Tarar during an exclusive interview with Customs Today on the performance of the Anti-Smuggling Organization. Collector Ambreen Ahmad Tarar said that massive anti-smuggling campaign enhanced revenue collection of the Collectorate as it surpassed annual fiscal targets of the outgoing fiscal year 2017-18. The effective anti-smuggling campaign launched against the smuggled goods and non-duty paid items significantly reflected in the revenue collection in which the Collectorate of Multan Customs made a record and set an example for other collectorates. She expressed that Multan Customs is the major revenue generating Collectorate of the Central Region and the Collectorate has its signiQicant importance for the business community of South Punjab due to its geographical location. She added that Multan Customs Dry Port is the only import clearance station in South Punjab for importers. Multan Customs has promoted legal imports and legitimate trade through their intensive anti-smuggling campaigns in the region. Ambreen Ahmad said that performance of ASO has improved by 300 percent as the Anti-Smuggling Organization has seized massive smuggled goods and non-duty paid vehicles worth Rs1017.545 million from January 2018 up to 20th December 2018. On the other hand,
the Collectorate has made 139 seizure cases worth Rs 403.392 million of non-duty paid vehicles and miscellaneous goods during the corresponding period of FY 2017-18. Whereas, MCC Multan was able to frame 161 various seizure cases by seizing goods and miscellaneous articles worth Rs 222.97 million during the corresponding period of FY 2016-17. Multan Customs impounded almost 167 non-customs paid vehicles of various expansive brands and made-ups of Rs 300.7 million for the duration of January to 20th December 2018. These seized vehicles included Toyota Land Cruiser, Toyota Hilux Surf, Toyota Corolla, Camry, Honda Civic, Toyota Altis and others. On the other hand, Anti-Smuggling Organization Multan seized 115 vehicles of Rs212.8 million during the same period in 2017. Multan Customs successfully seized huge quantity of High Speed Diesel, POL products, Art silk cloth, dry fruits, milk powder, tyres, Gutka, cigarettes, blankets, ceramic tiles and other goods worth Rs716.845 million during the said period. Multan Customs Anti-Smuggling Organization lodged 24 different criminal FIRs against smugglers and arrested several offenders by adopting zero-tolerance policy. Due to rigorous strategy against smuggled goods, Multan Customs produced fruitful results to curb the menace of smuggling from the region. Multan Customs has outperformed all the other Collectorates and directorates of intelligence in the Central Region as it made maximum cases in terms of number, value and arrest during the said period due to aggressive approach against smuggling. She said that Anti-Smuggling Organization has identiQied few clandestine routes in the territory which are adopted by the smugglers for smuggling of goods and vehicles. Monitoring of suspected routes has been enhanced in the jurisdiction to restrain smuggling under the new strategy. Customs has initiated special vigilance of the speciQic areas in order to curtail smuggling in the territory and Anti-Smuggling Squad has focused on Dera Ghazi Khan Taunsa region especially which was being used in cross-border smuggling from Baluchistan Punjab. Collectorate of Customs Multan has enhanced cooperation with other law enforcement agencies including Motorway Police, Balochistan Military Police (BMP), Customs Intelligence and others to curb smuggling in the jurisdiction. The Collectorate has an honest and dedicated team of ofQicers and staff that always focused on uprightness, productivity and discipline which yielded positive results.
Multan Customs ASO lodged 24 dierent criminal FiRs against smugglers and arrested several oenders by adopting zero-tolerance policy
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08 eDITORIAL
DeCeMBeR 25 - DeCeMBeR 31, 2018
Founder & Chairman Zulfiqar Ali CeO and Chief editor Asad kharal editor Rahil Yasin editor@customstoday.com.pk For advertising & subscription marketing@customstoday.com.pk www.customstoday.com Phones: 042-35781643-4, Fax: 042-35781645 Address: 627, Siddiq Trade Centre, Gulberg, Lahore
EDiTORiAl
Putting economy on right path
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ederal Minister for Planning and Development Khusro Bakhtiar, at the annual general meeting organised by the Pakistan Institute of Development economies (PIDe), stated that the government will make all-out efforts to put the economy on the right track and focus on strengthening economic fundamentals and devise an investment strategy for efficient resource allocation. Blaming the past government, he said that "over the past five years, global crude prices reduced to record low levels, but the economic managers in Pakistan failed to take the advantage. We have to make painful decisions and in the short run inflation will go up." Defending the PTI government's policies, he claimed that during the first 100 days of the present government, inflation had gone up from 5 percent to only 6 percent. Value-addition is needed for Pakistani exports and the firstever special economic zone will be inaugurated in the first quarter of next year. Quantum of consumption in Pakistan is 90 percent of GDP, the highest among the emerging economies, compared to 74 percent in Bangladesh. India and China are sustainably growing at 8 percent and 7 percent per annum, respectively, while Pakistan is growing merely at 4 percent. Another serious challenge is our saving rate, which is just 10 percent of GDP compared to 30 percent in India while private sector investment is only 10 percent of GDP which is the lowest in the region. Country's economy is based on imports and that is the principal reason behind alarming rise in current account deficit. Pakistan and China will sign an industrial cooperation framework during the Joint Cooperative Committee on CPeC scheduled on 30th December, 2018. The framework agreement would help move forward with relocation of Chinese industries and large-scale investment in Pakistan. Industrial Parks would be developed in SeZs with local resources to promote investment and help import substitution for balancing the Pakistan-China trade. Khusro Bakhtiar made ample sense and are quite convincing. He is right in saying that crude prices were quite low in the last few years but PML(N) government failed to take the advantage of lower prices. In our view, if Pakistan had continued to devalue the rupee as per market requirements and taken the right measures to contain the trade deficit over the past few years, instead of relying on foreign borrowings, external sector crisis could have been avoided and the present government would have been spared the trouble to run from pillar to post to ensure solvency of the country.
Reconstructing policy frameworks T
LAHORe
CUSTOMS TODAY REPORT www.customstoday.com
he November’s export Qigures have been somewhat disappointing, but the good news is that Pakistani textiles may be seeing a much awaited up-turn; one that has perhaps been awaited for almost a decade! By conservative estimates if the level of current international-buyers’ interest sustains itself in 2019, the textile sector may add up to $2 billion worth of exports while of course adding accompanying jobs and economic activity in the markets. And if it happens, it would surely add some credibility to government’s rationale on its abrupt devaluation of the national currency. However, the government needs to be careful on
making too much out of it, not only because devaluation is never a sustainable solution, but also that capturing short-term industrial gains requires a lot of focused efforts. First, to harness the full potential of this ‘short-term’ competitive advantage of Pakistani textiles, it will need to fully support the industry by primarily allowing it a conducive environment and a free-run to optimise its efQiciencies and production. Meaning, counterproductive governmental oversight will have to be curtailed, whereas, the opposite seems to be the case at present! Second, it needs to take into account that owing to previous government’s poorly thought through industrial policies, a big chunk of the industry either stands dismantled or is lying closed. In order to rekindle this dormant capacity, giving the
textiles entrepreneurs a renewed conQidence will be the key. This can only be done by quickly unleashing a Qive years industrial policy vision that aims at facilitating manufacturing rather than squeezing it. And third, it will need to craft a sound growth strategy that not only takes into account the global trade games currently being played, but also has the capacity to succeed amidst a new modern industrial structure that relies more and more on ‘innovation & productivity’ as the new tools of competitiveness instead of the traditional or the old tools of labour, currency and state support. Moreover, since Pakistan’s exports in general measure quite low on the value-addition scale and as the underlying diversity base of its exportable products is fairly narrow, policymakers will
have to be careful to not fall into the trap of simplistically correlating export gains to a devaluation exercise or to even think of conducting any type of precise trade–off calculations between gains from surge in exports (through devaluation) vs. the likely economic fall–outs (such as: increase in foreign national debt in rupee terms; decrease in underlying dollar value of market assets (for example stocks); increase in short–term foreign currency liabilities borrowed to support FE reserves; raising barriers to capital investment in the economy (especially in plant & machinery); distorting dollar based targets of annual corporate revenues; and last but not least, unleashing of a sort of involuntary inQlation tax on the common man) – the latter invariably ends up outweighing the former.
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NATIONAL 09
DeCeMBeR 25 - DeCeMBeR 31, 2018
Court approves physical remand of suspect involved in injections & mobile phones smuggling case KARACHI:The Customs Court sent suspect namely Zeeshan Ali Awan son of Sikandar Ali to customs preventive lock-up on physical remand, who was booked in a case of attempting to smuggle 10,000 Boostin/Somatotropin injection and mobile phones. Investigation officer of Customs Preventive produced the suspect before the court and informed that on credible information,the suspect was intercepted at International Arrival,JIAP,Karachi and the official recovered foreign origin hormones injections which induce cows to produce more milk.He further submitted that one laptop,Samsung S8,Samsung S7 edge,Nokia 105,Samsung SM-G950F worth Rs30 million were also recovered from the suspect.He argued that prosecution needs further investigation from him,therefore,court may grant his physical remand.
SC Special bench decides 122, LHC 265 tax related cases
Govt must take concrete action against blackmailing of shipping cos
LAHORe
MULTAN
www.customstoday.com pecial Tax Benches have been constituted in the Supreme Court of Pakistan and the Lahore High Court for hearing of Tax related cases. Special bench at the Supreme Court of Pakistan has decided over 122 cases whereas the special bench at the Lahore High Court has decided over 265 tax related cases. The Federal Board of Revenue had earlier provided the details of pending cases to the Supreme Court and the Lahore High Court with the request to formulate special tax benches. The Board also issued special instructions to the field formations to ensure that the departmental cases are properly prepared and represented before the courts when these are fixed for hearing. Special Bench at the Supreme Court comprising Justice Umar Ata Bandial, Justice Munib Akhtar and Justice Yahya Afridi started hearing of cases around the middle of October 2018 while special bench at the Lahore High Court comprising Justice Shahid Jamil Khan and Justice Asim Hafeez have been hearing tax related cases since 23-10-2018. So far, the special bench at the Supreme Court of Pakistan has decided over 122 cases whereas the special bench at the Lahore High Court has decided over 265 tax related cases. Formation of these Special Tax Benches is expected to speed up the hearing process and decisions in pending tax and expedite recovery of potential tax revenue.
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wRiTE TO US YOUR GRiEvAnCES: Through CUSTOMS TODAY platform hElP DESk, now you have chance to DiRECTlY write your problems to top govt. functionaries. If you have any grievances, queries, questions or suggestions, you can write in this section as it provides easiest access to you to approach Customs and Revenue authorities. whO can write in this section? Importers & exporters, Customs Agents, Chambers of Commerce, Trade Associations and Customs Officers TO whOM you can write? Honourable PM, Minister/Secretary for Finance & Revenue, Minister/Secretary for Ports and Shipping, FBR Chairman, Member Customs and Chairperson Senate/National Assembly Standing Committee on Finance & Revenue. Send your letters at: newsdesk@customstoday.com.pk
iMRAn Ali khAn
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inistry of Ports and Shipping must take concrete action against a few shipping companies to stop their blackmailing and collecting unreasonable demurrage and detention charges. Despite extensive coverage and unearthing of the scam by Customs Today and other media houses, the government has not yet taken any action against law violators. While talking to Customs Today, Advocate Sher Zaman Qureshi said Pakistan has established accountability institutions aimed at implementing mechanisms for preventing, detecting, punishing, and eradicating corrupt acts in the country but a few shipping companies are continuously violating set laws. Their corruption is causing serious obstacles to development in the country. He said blackmailing of a few shipping to demand exorbitant demurrage and detention charges should be stopped and they are openly violating SRO 1220(I)/ 2015. He said that SRO 1220(I)/ 2015 explains that shipping companies cannot charge any demurrage and detention where speciQically it is not agreed and also speciQically not mentioned on the B/L (Bill of lading) but shipping companies are compelling genuine importers to pay excess charges in shape of detention charges.
— Exclusive Customs Today photo
SAJiD nAwAZ
He said a few shipping companies are operating like a maQia and they create unnecessary delays in the clearance of shipments by making lame excuses. Even importers are blackmailed which are issued delay and detention certiQicate from Customs. According to Section 14-A of the Customs Act, 1969, importers cannot be forced to pay any demurrage or detention charges if Customs gives a certiQicate to importer called the ‘delay and detention certiQicate’. But despite
Advocate Sher Zaman
this certiQicate, importers’ goods are held illegally to demand heavy amounts as demurrage. Sher Zaman said genuine importers are facing harassment and Qinancial blackmailing for clearance of their shipments and this situation also compels genuine importers to stop clearance of their shipments in order to avoid from blackmailing of shipping companies. He said newly elected government should take notice of the situation as it always emphasized upon rooting out corruption by promoting trans-
parency in the country. He said that several importers also raised the issue of additional demurrage and detention charges collected by a few shipping companies but Ministry of Port and Shipping did not take any action in this regard. Undue detention and demurrage charges increase cost of business unnecessarily, putting Qinancial burden on importers. He expressed that government must encourage the importers and exporters by eliminating hurdles to enhance clearance from Karachi ports.
FPCCI wants conducive environment for business sector To,
are dwindling due to which pressure was increasing on the local currency. The best way to improve forex reserves is to promote exports. However, the cost of doing business in Pakistan is quite high due to which our exports are facing stiff competition in the international market. The government should take all possible measures to bring down the cost of doing business that would help promote exports and improving the economy. In the end, I reiterate that your government should focus on creating environment for business activities in order to strengthen the economy.
Asad Umar, Finance Minister, Islamabad Dear Sir,
It is to highlight that the economy is passing through a difQicult phase, so your government should focus on creating conducive environment for business sector that would help revive the economy. The business community is key stakeholder in the economic development and government should take it on board while forming business and economic policies. The synergy in the efforts of public and private sectors is essential to put the economy on the path of sustainable growth. FPCCI in consultation with chambers and
association would make efforts to promote the interests of the business community of Pakistan so
that private sector could feel facilitated in promoting business activities. Forex reserves of Pakistan
Best Regards,
Karim Aziz Malik, Vice President, FPCCI, Islamabad
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10 NATIONAL
DeCeMBeR 25 - DeCeMBeR 31, 2018
Faisalabad Customs reshuffles nine employees FAISALABAD:Collectorate of Customs reshuffled nine employees of the Collectorate with immediate effect and until further orders.According to the notification,Deputy Collector Aneeqa Afzal (Headquarter) has transferred employees of Faisalabad Customs to get better results in assigned tasks.Sepoy Muhammad Allah Ditta transferred from Faisalabad International Airport to Bond Section while Sepoy Muhammad Amin and Muhammad Khalil and Sajid Hussain transferred from Faisalabad International Airport to Anti-Smuggling Organization Faisalabad.Sepoy Javed Iqbal relocated from General Post Office to State Warehouse whereas Sepoy Muhammad Yasin transferred from Customs Complex to Faisalabad airport.
Govt should cancel licenses of shipping cos involved in demurrage, detention scam MULTAN
iMRAn Ali khAn
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he government should immediately cancel the operational licenses of those shipping companies who are involved in collection of exorbitant demurrage and detention charges from genuine importers. It was stated by Chairman All Pakistan Anjuman Tajiran Khawaja Muhammad Suleman Siddiqui in his exclusive talk with Customs Today the other day. He said that the collection of exorbitant demurrage and detention charges by several shipping companies on clearance is a sheer violation of laws and those shipping companies operating license should be canceled under SRO1220(I)/2015. Collection of demurrage and detention charges from importers of South Punjab and other regions of the country without any speciQied agreement is unfair. He said that several shipping companies are blackmailing importers during clearance of their shipments and collection of demurrage and detention charges from importers is intolerable and importers are facing huge obstacles in the clearance of their shipments on time due to their blackmailing. He said that All Pakistan Anjuman Tajiran has been constantly receiving complaints against these shipping lines and their agents involved in taking unjustiQied demurrage and
— Exclusive Customs Today photo
detention charges from importers of South Punjab for the clearance of shipments. Importers of South Punjab faced blackmailing of shipping companies for the clearance of their legally imported shipments and shipping companies charged unjustiQied demurrage and detention charges, otherwise importers have to face an insignificant delay in the clearance of their shipments which also causes Qinancial loss to importers. He said that South Punjab is the hub of trade activities in the
khawaja Muhammad Suleman Siddiqui province which is contributing a He said that shipping compahuge portion of revenue in wake nies and port authorities cannot of taxes to Federal Board of charge any demurrage or detenRevenue, Customs department tion charges if Customs provides and national exchequer. a delay and detention certiQicate Illegal collection of demurrage to importers but reportedly even and detention charges would with this certiQicate several convert into a big crisis for shipping companies are charging importers and exporters because illegal demurrage to genuine shipping companies are looting importers by violating set laws. huge revenue from importers by He demanded the Ministry of trapping them with offering low Ports and Shipping to take rates at the initial stage but when special measures for guarding the shipment reaches Karachi importers against their blackthey don’t release the goods and mailing by regulating shipping demand additional charges. policies to promote business
activity. Government should take strict action against shipping companies for charging additional demurrage and detention charges. He suggested the government to take action against shipping companies who were involved in charging excess logistic charges and they should be punished under rules 603(q), 603(r), 604(p), 604(q) & 607(e), others under SRO 1220/2015 which includes penalty and also cancellation of license.
QMobile approaches SHC to seek amnesty under SRO 1455(1)2018 & release of consignment M
KARACHI
M.b RAnA
www.customstoday.com /s Digicom Trading Private Limited (Q Mobile phone company) approached the Sindh High Court (SHC) for beneQit of the amnesty provided under SRO 1455(1)2018 and to release the consignment of the petitioner without any further delay which was seized by customs ofQicials due to alleged mis-declaration. Counsel for the petitioner stated in his constitutional
petition that on December 17, 2017 a consignment of 4 containers declared to contain LED lights were imported in the name of petitioner’s company and cleared through green channel facility. On account of some conspiracy by some unscrupulous elements, wrong shipment of mobile phones was made by UAE based shipper in which three containers were de-stuffed by customs ofQicials on the charges of smuggling and mis-declaration. He submitted that a show cause notice was issued to the petitioner
and petitioner submitted reply, however, Qine equivalent to 35% of value of the goods was imposed beside penalty of Rs2 million each in addition to payment of duty and taxes. He argued that meanwhile the FBR has issued SRO 1455(1)/2018 whereby mobile device with SIM or IMEI functionality brought into Pakistan in violation of the provisions of clause (s) of Section 2 of the Customs Act, 1969 which have been seized or voluntarily presented to customs authorities on or before 31/12/2018 shall be
allowed and would be released on payment of applicable duty and taxes payable thereon with imposition of zero Qine. That petitioner is ready to avail the beneQit of the scheme given under SRO 1455(1) 2018 read with CGO 06/2018. He said that in pursuance of the afore-mentioned notiQication, application was Qiled in before custom ofQicials opting to avail beneQit of scheme provided by the Government vide SRO 1455(1)/2018 for release of seized mobile sets by respondents and
refund of securities for the remitted amount of Qine and penalty by customs ofQicials Citing chairman Federal Board of Revenue, Collector of Customs Preventive, Collector of Customs Preventive West as respondents, importer pleaded the court may declare the petitioner is entitled to the beneQit of the amnesty provided under SRO 1455(1)2018, direct them to release the consignment of the petitioner without further delay. He also pleaded the court may restrain from taking any coercive action including blocking of NTN/ User-ID of the petitioner.
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CARTOONSSPeCIAL 11
DeCeMBeR 25 - DeCeMBeR 31, 2018
Customs generates Rs13m through auction of 10 PM house vehicles ISLAMABAD: Collectorate of Customs generated Rs13 million through auction of 10 luxury vehicles of Prime Minister House.Sources told Customs Today that it was the 3rd auction of vehicles surrendered by PM House during the last two months (November–December) of Fiscal Year 2018-19. The sources said that the Prime Minister House handed over 49 old vehicles to MCC for auction. They added that the Collectorate sold nine vehicles during initial two public auctions held at State Ware House Islamabad in October and November Fiscal Year 2018-19. The sources said the Collectorate held public auction after advertising through banners and social media accordingly so the general public can participate in the auction process.
Faisalabad Adjudication recovers Rs283.928m after deciding 171 seizure cases FAISALABAD
nAEEM ShEikh
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he Customs Adjudication recovered Rs3283.928 million after concluding different seizure cases from July till December 15 of current Fiscal Year 2018. Sources told Customs Today that Customs Adjudication decided 171 cases during the above-said period. The Customs Adjudication issued Orders-inOriginal (ONOs) in all cases in favor of the Customs Anti-Smuggling Organization Faisalabad, Sargodha, Mianwali, Jhang, Sara-eMuhajir and Customs Intelligence and Investigation Faisalabad. The department heard cases of smuggled oil, cloth, Indian tea, auto parts, Iranian diesel, Rani juice, used laptops, Toyota Corolla different brands and other items. Collector Adjudication Asif Abbas decided 27 cases which involved Rs3116.165 million. While Additional Collector Asma Hameed settled 64 cases involving Rs 133.729 million.
Peshawar dry port collects Rs317.10 million against Rs647 million target
Gwadar Customs seizes hashish & liquor worth Rs4 million during operation GWADAR
wAQAR AhMED AnSARi www.customstoday.com
PeSHAWAR
P
nADiR khAn
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eshawar dry port collected Rs329.902 million against the target of Rs647 million with a difference of minus Rs317.10 million while the total difference in percentage was recorded minus 49.01 percent up to December 15, 2018.
Sources told Customs Today that the dry port collected Rs140 million against Rs134.674 million with a difference of minus Rs5.33 million while the difference in percentage was minus 3.80. Likewise under the head of sale tax, the dry port collected Rs 237.740 million with a difference of Rs237.74 million or 0.34 percent. Likewise under the head of
additional taxes, the port collected Rs90.480 million against Rs104.54 million with a difference of minus 26.15 million while the difference in percentage was minus 25.01 percent. Under the head of import duty, the dry port collected Rs191.49 million against Rs143 million of November 2017 while under the head of import regulatory duty, the dry port collected Rs61.65 million.
ollectorate of Customs team seized huge quantity of hashish and liquor worth Rs4 million including vehicle being used for smuggling. Sources told Customs Today on 18th December that Deputy Collector Junaid Mehmood received secret information that some smugglers are trying to smuggle a huge quantity of hashish and liquor from Gwadar to other cities. After receiving this information, he constituted a raiding team under the supervision of Customs Preventive Inspector Khalid Ali Azhar, Mustaqeem Ibraheem and others. The team, during a search operation on exit way of Gwadar, intercepted a vehicle bearing registration no XGK-9476. During the search, the team impounded 20 kilograms of hashish and 40 bottles of wine valued at Rs 4 million including truck being used in smuggling. The team seized all smuggled items and arrested smugglers while further investigations are still underway till filing of this report.
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DeCeMBeR 25 - DeCeMBeR 31, 2018
Faisalabad Customs recovers huge quantity of liquor from airport FAISALABAD: Collectorate of Customs staff team deputed at Faisalabad International Airport recovered 15 bottles of foreign origin liquor during checking of luggage of passengers. Sources told Customs Today that after strict instructions from Collector Asif Mehmood Jah, customs team enhanced monitoring of passengers at arrival and departure lounges. During the examination process, customs staff recovered 15 bottles of liquor which were hidden in the luggage of passenger. The liquor was recovered from the baggage of passenger who was identified as Muhammad Khalid Javed bearing passport no: FX 8677551 arrived from UK through flight no: GF 790 from Bahrain to Faisalabad International Airport.
Number of taxpayers increased by 30pc to 1.4m in a year: Hammad Azhar LAHORe
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inister of State for Revenue Hammad Azhar has said that number of taxpayers in the country have increased by 30 per cent during a year, while the Federal Board of Revenue (FBR) has issued notices to further 20,000 non-Qilers. Addressing a press conference at Directorate General Public Relations (DGPR) Punjab, he said that so far 1,400,000 (1.4 million) taxpayers have Qiled their tax returns. He said that Pakistan Tehreek-eInsaf (PTI) government has put in place special measures to facilitate the taxpayers, improve tax procedures and bring tax reforms to ensure ease of doing business. The minister said that it was decided to translate the Federal Board of Revenue (FBR) policies and tax laws into Urdu language for making the tax system easier to understand for the common man. He said that it was needed to develop a mechanism and bridge the communication gap between FBR’s Qield ofQicers, who collect the taxes and administrative ofQicers who form policies for better output of the department, adding that facilities would be provided to the Qield ofQicers so that they could better facilitate the taxpayers. Hammad Azhar said that FBR would publish a tax directory pertaining to tax returns of parliamentarians, adding that the PTI government was committed to bring tax reforms and expand tax net in order to put the country on
way to progress and prosperity. To a question, he said that previous amnesty scheme was granted legal cover so that it could not be withdrawn, adding that action was being taken against 3,500 tax evaders and non- Qilers with proven trail of large business transactions
Minister of State for Revenue hammad Azhar
and Qinancial deals. To another question, the minister said that FBR would be made a ‘business friendly’ organization, adding that PTI government was working in right direction to put economy on right track. The exports have started to
increase, he maintained. To a query about mobile tax policy for foreign visitors, he said that no registration and duty was needed on any phone using international roaming or to be used in Pakistan for less than 30 days. For all other phones to be used in
Pakistan, travellers can pay their duties and registration at either the airports or in any of the customs houses across the country, he added. He said that system of Pakistan Telecommunication Authority (PTA) and Customs has been integrated to curb smuggling of cell-phone.
Rs18.734 million tax evasion: Multan Adjudication issues show cause notice to PSO C
MULTAN
iMRAn Ali khAn
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ollector Customs Adjudication issued a show cause notice to M/s Pakistan State Oil Company Limited against tax evasion of Rs18.734 million in wake of Petroleum Development Levy. According to details, Multan Customs conducted an audit of the ex-bonded High Speed Diesel (HSD) cleared through Multan Dry Port by M/s Pakistan State Oil Company Limited. Multan Customs found during the audit that M/s Pakistan State Oil Company Lim-
ited cleared 4,153,923 liters and applied the rate of Petroleum Development Levy @Rs2.59% per liter instead of applicable rate @Rs.7.1 per liter under SRO (I)/2013 dated 31st January 2014. M/s Pakistan State Oil Company Limited paid petroleum development levy of Rs10.758 million with the rate of Rs2.59 per liter but the actual duty amount was almost Rs29.492 million with applicable rate of Rs7.1 per liter which resulted in short-realization of Rs18.734 million. The amount of petroleum development levy Rs18.734
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million is still recoverable from M/s Pakistan State Oil Company Limited PSO House, Khayabane-Iqbal Clifton Karachi under sub-section (3A) of Section 32 of the Customs Act 1969. Collectorate of Customs framed a contravention report against M/s Pakistan State Oil Company Limited for tax evasion and forwarded the case to Customs Adjudication for legal trial. Collector Customs Adjudication Asif Khan Buzdar issued show cause notice to M/s Pakistan State Oil Company Limited and asked them to submit their reply within next 10 working days.