Following the massive evasion of duty and tax in the clearance of imported vehicles under the baggage scheme, the Customs department has given a go-head to all departments concerned to take those responsible for the violations to task. According to informed sources, the chief collector of customs appraisement in Karachi has issued a circular after it was noticed that declaration of goods for clearance of vehicles under the scheme were being filed at reduced declared values.
The violation, which results in insignificant upfront payment of duty and taxes, is in grave violation of Section 79 (I) (a) and (b) of the Customs Act, 1969. All departments concerned have been informed that strong action would be taken in cases where difference between declared and assessed values was more than 30 percent. The disciplinary action, including contravention proceedings, would be initiated against the individuals found responsible.
The instructions were circulated last week, according to the sources, but no department has established any contravention report so far, despite massive duty and tax evasion in clearance of imported vehicles under the baggage scheme. The sources also said that in connivance with customs officials traders were exploiting baggage and gift schemes, which was denting the local industry and the national exchequer.
They said that passports of overseas Pakistanis from the Gulf countries, particularly workers and labourers, were being used, against payments of Rs 10,000 to Rs 20,000 to the individuals, for import of vehicles into Pakistan, with officials within the customs groups involved giving clearance to these vehicles against hefty bribes.
As a result, the sources said, the three segments of the domestic auto industry-small cars and minivans, high-end sedans, and SUVs-are being hurt by the rampant misuse of concessionary schemes for importing vehicles meant to facilitate overseas Pakistanis.