Directorate General of Customs Valuation Karachi has worked out new customs values for the import of energy drinks for better/fair assessment of customs duty. Sources told Business Recorder here on Sunday that the directorate has determined customs value of imported energy drinks under section 25A of the Customs Act, 1969.
It was brought to the notice of Directorate General of Customs Valuation by field formations that the energy drinks were being imported at under invoiced value, causing loss of revenue to Government exchequer. This prompted the department to undertake an exercise to determine the fair customs values for imported energy drinks. On analysis of import data, the declared values of subject goods, imported from different sources were found on lower side as compared to prices in the international market and it was also found that these items were being assessed at different values. Therefore, to rationalise values of subject imported goods, an exercise to determine the Customs values of said products in terms of Section 25A of the Customs Act, 1969, was initiated.
Sources said that the valuation methods given in section 25 of the Customs Act, 1969 were applied to address the valuation issue at hand in terms of section 25A(1) of the Customs Act. Transactional value method under in section 25 (1) was found inapplicable because of substantial variation in declared values and non-availability of sufficient information with respect to adjustments to be made to the transactional value in terms of section 25 (2). Identical/similar goods valuation methods provided in section 25(5) & (6) furnished unreliable values because of considerable variation in declared values among various import transactions. Since the manufacturers' cost of producing the goods in question in the country of export was not available, computed value method as provided in section 25(8) could not be applied for valuation of the aforesaid goods. Deductive Value Method under section 25(7) of the Customs Act, 1969, was thus applied to arrive at the assessable customs value.
Sources said that on the basis of market inquiry, meetings were called to obtain stakeholders views on valuation of energy drinks, but no one appeared for the inquiry neither any written reply was received from them.
Energy Drinks hereinafter specified shall be assessed to duty/taxes at the following customs values: Red Bull, the customs value would be US $0.52/250 ml; Effect, the customs value US $0.66/250 ml; Rock Star, the customs value US $0.59/500 ml; Boost-customs values US $0.34/250 ml; energy drink-Lucozade, the customs value US $0.33/330 ml; Irn Bru, the customs values US $0.26/330 ml and in case of other energy drinks the customs values would be US $1.20/1000ml.
Sources said that the customs values determined in the Ruling shall remain applicable customs values for the aforementioned goods till the time the Valuation Ruling is rescinded or revised by the competent authority in terms of Section 25A of the Customs Act, 1969. Moreover, this Valuation Ruling applies to cases where declared values are less than the customs values determined in the ruling. In cases where declared values are more than the customs value determined in the ruling, the concerned assessing officers shall apply such higher values in terms of section 25(1) of the Customs Act, 1969. Moreover, in case of consignments imported by air, if the differential between airfreight and sea freight, when taken into account, raises the customs value above those determined in the ruling, the concerned assessing officers shall apply such higher values in terms of section 25(1) of the Customs Act, 1969.
The Customs Act, 1969 provides efficacious alternate remedies against the Ruling. Section 25-D provides that any person aggrieved of the Ruling may file a revision petition within 30 days from the date of this Ruling before the Director General, Directorate General of Customs Valuation, Karachi. An appeal against the decision in revision of the Director General can be filed within 60 days of the decision before the Customs Appellant Tribunal under section 194-A (1) (e) of the Customs Act, 1969.