Meanwhile, the FBR has decided to introduce an electronic data exchange system to reduce the problem of under-invoicing and under-valuation of goods coming into the country. The system is being set up in collaboration with the State Bank of Pakistan (SBP).
According to documents available to The Express Tribune, the FBR is consulting the ministry of commerce on the imposition of a restriction on the import of goods without a formal sales contract and the opening of a letter of credit.
Although an agreement has been reached in principle, a final decision can only be taken by the government after the matter is discussed by the Economic Coordination Committee.
A senior official of the FBR commented that the government was serious about combating smuggling and a concrete strategy was being prepared to counter the problem. He said that smuggling and under-invoicing not only resulted in the loss of collectible duties but also damaged the local industry.
In order to reduce the under-valuation of imports, the FBR has directed all field formations across the country to make use of the customs valuation gateway.
The documents revealed that the customs valuation gateway website has been operational since March. This website contains reliable data on the prices of goods in the international market and the FBR has encouraged the use of this data to ensure that imports are valued at the correct price.
The mechanism of sharing information on foreign exchange remittances with the customs department is also being discussed with the SBP and Pakistan Banks’ Association.
Published in The Express Tribune, July 24th, 2010.
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