Curbing under invoicing of imported goods: Pakistan signs agreements with several countries

Pakistan has executed co-operation agreements in customs related matters with several countries like China, UAE, Iran, Kyrgyzstan, Turkey, Azerbaijan, Mauritius, Uzbekistan, USA, SAARC and D-8 member states to curb under-invoicing. Sources told Business Recorder here on Friday that the Federal Board of Revenue (FBR) was working on a comprehensive strategy to check the menace of under-invoicing.
Besides the said agreements, the government was also negotiating for co-operation agreements in customs matters, including valuation with Japan and ECO countries, they added. They further said that in order to plug revenue leakage due to under invoicing of imported goods, different steps had been taken to improve valuation and assessment process.
"Firstly, Pakistan Customs Valuation Gateway (PCVG), a customs valuation website, was launched and is operational since March, 2010. The international reliable data on prices of goods is available in Pakistan Customs Valuation Gateway as a reference tool to check under invoicing," they added, adding the valuation database is compiled by using international journals and websites like LMB, Public Ledger, ICIS, Polymer scans, etc.
"Besides these steps to curb the menace, co-operation agreements in customs matters have been executed with several countries like China, UAE, Iran, Kyrgyzstan, Turkey, Azerbaijan, Mauritius, Uzbekistan, USA, SAARC and D-8 countries. After proper field investigations by the Directorate General, 113 Valuations Rulings have been issued during the financial year 2009-2010 to curb under invoicing in some of the major revenue spinning sectors like iron/steel, paper/paper board, cosmetics and electronic appliances," they added.
The sources said that the introduction of Self Assessment System (SAS) in customs requires the creation of Post Clearance Audit department to check declarations, particularly those cleared by the system under 'green' flag. The Directorate of Post Clearance Audit became operational and was in its formative phase, they added.
They maintained that despite being a new organisation, it had shown very impressive performance. Total detections made since July 2009 were worth Rs 6.3 billion against Rs 2.3 billion in corresponding period of previous fiscal, showing a substantial increase in revenue, they said. "Presently, the development of Post Clearance Assistance System (PCAS) is underway for profiling of importers and selection of audit cases on automated basis," the sources added.