ISLAMABAD: Leading export associations have declared Federal Board of Revenue's (FBR) proposed unified export scheme as an anti-export measure to shift all export promotion schemes from Regulatory Collectorates to the Input Output Coefficient Organization (IOCO) by creating the complications in granting approvals, audit and submission of securities.
Some of the associations which have approached the FBR regarding the proposed scheme are: Pakistan Textile Exporters Association; Sialkot Chamber of Commerce and Industries; Pakistan Hosiery Manufacturing Association; All Pakistan Fruit and Vegetables Exporters Association and others.
Exporters told Business Recorder that the proposed scheme would have serious implications in granting the approval and security instruments. The audit has been proposed to be transferred to the Post Clearance Audit (PCA) without any consultation and recommendations of major stakeholders like exporters. The IOCO and PCA have only three offices across Pakistan, whereas the Islamabad office of the IOCO is still not operational.
The IOCO was created to assist on various technical and industrial issues relating to input/output wastage, determination of correct duty drawback in an institutionalized manner containing the sector specialists like engineers, cost accountants, and chemical examiners to do surveys in the fields on the basis of information provided by the applicant as well as by the Regulatory Collectorates.
Through the new scheme, the question arises why the IOCO has been given power of Regulatory Authorities and shifting its original domain of technical supporter of the custom wing. An organization needs to give support as a helping and technical hand to regulatory authorities on huge amounts of remission, but it plans to get power from the regulatory authorities. The IOCO should have to improve itself in international standards and on industrial grounds to provide technical support within an appropriate timeframe, exporters said.
The IOCO has to improve by new technical methods, particularly industrial knowledge and international standards to meet the new requirements by hiring technical engineers and examiners, experts explained.
Experts said the proposed SRO has been chalked out to shift the Export Promotion Schemes from all Collectorates to IOCO, without seeking comments of major stakeholders. There is a panic like situation among the exporters who were not expecting that the customs authorities would take such an anti-export measure. Practically, exporters will face more problems and burdens in processing of their Export Promotion Schemes related approvals and security instruments submission and then at the time of release after reconciliation of Export Promotion Schemes. After the drastic changes of shift of powers and functions, exporters would be bound for compliance of only two Directorates in Pakistan as regulatory bodies for application and processing of Export Promotion Schemes and the exporters belonging to city like Islamabad, Rawalpindi, Peshawar, Lahore, Multan, Faisalabad, Sialkot or any other city would approach Lahore for getting final approvals and processing of their cases. The exporters belonging to the said cities would have to physically go to Lahore which is almost impossible to spare time and money as compared to existing scheme where concerned Collectors of Customs are dealing with the issues of exporters.
Referring to the new scheme, experts stated that the Rule-7 and 9 of the draft notification are quite confusing and clearly stated that Regulatory Authority is IOCO, while Collectorate is just give the profile analysis report to IOCO within the prescribed time period, resultantly this will create lot of problems for exporters, the exporters will have to constantly approach both the Collectorates and IOCO in different cities.
Copyright Business Recorder, 2021