Misuse of material by pipe makers: Steel merchants demand withdrawal of two SROs

Steel merchants have demanded that misuse of SROs by pipe manufacturers should not be allowed as it is causing huge financial losses to the national exchequer as well as Pakistan Steel.
They, therefore, recommended withdrawal of all SROs which give exemption of duty, sales tax, etc, at a meeting of three associations, namely Pakistan Iron & Steel Merchants Association (PISMA), Pakistan National Steel Association (PNSA), and Karachi Iron & Steel Merchants Association (KISMA), held here recently. The main objective of the meeting was to expose all those commercial/industrial importers who are indulging in misuse of SROs and misdeclaration, causing huge losses to the national exchequer as well as driving honest importers out of business.
The Associations expressed grave concern in respect of:
-- Misuse of exemption of SRO No 450, 565 and DTRE by pipe manufacturers as there is no check regarding the use of exempted duty/sale tax raw material. Pipe manufacturers, instead of manufacturing pipe, are selling raw material exempted from duty and sales tax in open market and making windfall profits at the cost of national exchequer and honest importers.
-- Through misdeclaration by a few commercial importers with connivance of customs, the material is being cleared as 'alloy steel' and 'silicon steel' where the rate of duty is 5 percent but the material is actually subjected to 20 percent duty.
The meeting passed the following resolution for immediate action of the authorities concerned: The participants of the meeting were of the view that if they come across any case of misdeclaration they will take up the case with customs and concerned authorities and other relevant government departments and all the Associations will be part of the complaint.
It was unanimously decided that all brokers based in Karachi or Lahore will not sell the duty exempted material of pipe manufacturers. If any broker is found in indulging in illegal activity he will be handed over to the concerned authorities or any other relevant agencies by the Association. In order to maintain transparency, all the three Associations expressed willingness to assist customs authorities in case there is any doubt about the quality of material.
A group of clearing agents has volunteered to keep track of the consignments which have been misdeclared by any importer and inform the Association accordingly, so that the matter may be taken up with the customs officials.