It has been recently reported that the Directorate of Customs Valuation has increased the customs valuation rate on import of 1800cc and above vehicles. Due to limited number of choices available to the people of Pakistan, many have to import their favorite cars from other countries. The decision to increase the customs valuation rate has not been welcomed by the motor dealers of the country.
H.M. Shehzad, Chairman of All Pakistan Motor Dealers Association (APMDA), said that the decision will increase the prices of such vehicles by PKR 200,000 to PKR 1.5 million depending on the model. He added that there are approximately 400 vehicles in this range and the mechanism of customs valuation has been revised without taking relevant stakeholders into confidence.
Moreover, according to the announcement made by the Chairman of APMDA, the decision was taken instantly and the members of the association were left with no choice but to suspend the clearance of approximately 200 cars at the port. He added that the government will not receive PKR 3 billion in tax revenue they want due to non-clearance of vehicles.
In addition to that, members of APMDA also sent a letter to Ishaq Dar on April 27 in a bid to inform him that since 2008, all the assessment of customs duty on imported vehicles was finalized after the consensus of all the stakeholders including local assemblers and the association.
Furthermore, the members of APMDA said that between 2008 and 2016, the customs valuation rulings have been issued on the principle whereby the freight-on-board (FOB) would be arrived at by deducting 20 per cent from manufacturers’ suggested retail price on account of local taxation on the domestic models of vehicles being imported into Pakistan.