The customs duty reduction on the import of new cars has been deferred by one more year, the Senate Standing Committee on Finance was informed here on Saturday. Reviewing the tariff alterations in customs duty in the Finance Bill 2017-18, the FBR official informed that the cabinet has deferred the 10 percent reduction in the customs duty on new imported vehicles. "The earlier proposal was to reduce 10 per cent custom duty on import of brand new cars of 800cc to 1800cc making it 40 per cent from 2017-18, however it has been deferred for this budget," the officials of FBR said.
Chairman of the Standing Committee Senator Saleem Mandviwalla expressed concerns over the decision of the cabinet and stopped short of calling the auto sector of the country a 'lobby'. "These manufacturers have not been fulfilling their commitments in the country and use their influence to gain this protection," he said, "The previous government extended the old cars to five years but it has been reduced to three years by this government - we are giving too much protection to the auto sector."
Senator Mohsin Leghari even criticised the incumbent government for restricting the import of old cars which was not beneficial for the customers. "We want to support the auto sector of the country but the rights of the buyers too have to be honoured," Senator Mohsin Leghari added. Senator Saleem Mandviwalla added that there is a need to reduce duties on hybrid cars so that local manufacturers may feel the pressure of competition and invest in manufacturing them.
It was decided that the officials of Ministry of Industries would be invited in the meeting to discuss the matter. The committee was also informed that Pakistan is set to impose regulatory duty (RD) at mobile sets being imported from China. The committee was informed that around 25 million sets are being imported from China annually, but there is no duty at them due to free trade agreement, therefore, it has been decided to impose RD at the rate of Rs 650 per set - the same rate that is applied as customs duty on import of mobile sets. The other key tariff reduction proposed in the budget was decrease in the duties for import of raw material for diapers, and the spare parts of submerged motors and pumps.