Under invoicing and smuggling are big challenges for the economy

By Muhammad Sudhir Chaudhry – Deputy Bureau Chief Lahore

16th December, 2019

Director General Valuation Mukarram Jah Ansari has said that a big change in valuation system in line with international best practices for appeasement would bring a good change and positive effect for industry and trade will take place.

He was speaking at the Lahore Chamber of Commerce & Industry on Monday. LCCI President Irfan Iqbal Sheikh, Senior Vice President Ali Hussam Asghar, Vice President Mian Zahid Jawaid Ahmad, former President Mian Muzaffar Ali, former Senior Vice President Amjad Ali Jawa, former Vice Presidents Shafqat Saeed Paracha, Kashif Anwar, Zesshan Khalil, Fahim Ur Rehman Saigal, Executive Committee Members Wasif Yousaf, Haji Asif Saher, Malik Muhammad Khalid, Khalid Usman, Sh Sajjad Afzal,Naseem ul Ghani, Atif Ikram, Fiaz Haider, Zeeshan Sohail Malik, Arshad Khan, Haris Attique.

The DG said that issues such as under invoicing and smuggling are big challenges for the economy. Change in valuation system would improve the tax collection while government, law enforcement agencies and the department are committed to root out the menace of smuggling.

While throwing light on the magnitude of mis-invoicing and resulting revenue loss in Pakistan, he said that according to a report, volume of trade mis-invoicing exceeded US$ 92.7 billion during 1972 to 2013 while revenue loss in term of customs duties and export with-holding tax remained US$ 11 billion.

Mukarram Jah Ansari said that there is a huge difference in trade value with nine countries out of ten. While citing the example of China, he said that during year 2018, export value recorded at origin was US$ 16,967 million while value recorded in Pakistan US$ 14,545 million. So there was difference of US$ 2,422 million in value.

The DG said that issuance of valuation ruling, their revision, development of valuation database, dispute resolution between clearance collectorate and importer are some of the functions of DG valuation.

LCCI President Irfan Iqbal Sheikh said it is the routine practice that all the meetings regarding valuation are being held at Karachi. He proposed that these meetings should also be convened at Lahore. He said that notifications of all meetings regarding valuation which are scheduled to be held in Karachi should be served well before time so that the members of upcountry areas could easily plan their participation.

He said that LCCI members complained that sometimes their shipments are assessed for valuation on retail price of imported commodities which is higher than the whole sale price. The Customs officials must understand that containers are booked in bulk and cut-rate prices are mentioned in import documents.
Irfan Iqbal Sheikh said that there is another observation about Valuation Officers that they apply different parameters while assessing the valuation of separate import consignments containing similar items. This results in lack of uniformity and we are of the view that this issue has to be addressed on priority basis.
Moreover, whenever any change is made in Customs valuation rules/procedures, the private sector must be made aware of it and also taken into confidence.

LCCI Senior Vice President Ali Hussam Asghar and Vice President Mian Zahid Jawaid Ahmad said that interaction between the departments and private sector are very important in developing good working relations.

Atta Ur Rehman Khan

Web Editor & Columnist, BOL News conributed to the story

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