Surge in sales: FBR scheme boosts demand for smuggled vehicles in K-P

FBR allowed the legalisation of non-customs paid vehicles upon payment of a certain duty.

SWAT/ PESHAWAR:

People in Khyber-Pakhtunkhwa (K-P) have been swarming the local customs collector’s office ever since the Federal Board of Revenue (FBR) allowed the legalisation of non-customs paid (NCP) vehicles upon payment of a certain duty.

The FBR, under its Amnesty Scheme 2013, has tasked all customs houses in the country with legalising all NCP vehicles by March 31 this year. The move has not only prompted the owners of such vehicles, as well as car dealers and other K-P residents, to register as many of these vehicles before the deadline.

According to customs officials, they were not given any cap on the number of NCP vehicles which were to be legalised. Rather, they said, they have to register as many of these vehicles as they can by the March 31 deadline.



“We were told to advertise the scheme and facilitate all people who came to pay the duty on NCP vehicles as it would generate revenue for the national exchequer and fulfill the Supreme Court’s (SC) orders in this regard,” a customs official told The Express Tribune on condition of anonymity.

According to the official, the SC had earlier observed that NCP vehicles, many of which are smuggled across the border from Afghanistan, were being used in terrorist activities across the country. In light of this, the court ordered the registration of all such vehicles with the government, he added.

“The scheme will also decrease the sale of vehicles which lack proper documentation… This is a good chance for the owners to get such vehicles registered,” he maintained.

The official said that before any such vehicles were registered, they would have to be cleared by a laboratory. The process is intended to screen out vehicles that were either stolen or used in any other heinous crime.  Apart from paying a duty fee, the owner must also pay a one per cent tax on each vehicle for registration.



Talking to The Express Tribune, auto-dealer Muhammad Ali said that he shifted his own attention to NCP vehicles following the introduction of the scheme.

“Vehicles smuggled across the Torkham border are available at much lower prices… As such the government’s scheme increased the demand for NCP vehicles tremendously,” he maintained.

While car sales in Swat and Malakand divisions have risen dramatically following the move, the residents of both areas have castigated the step, saying it was aimed at bringing the region under the Pakistan Customs Act 1969.

“The government, instead of giving relief to the people of Malakand division, is trying to crush them under additional financial burden,” said Meraj Khan, a trader from Malakand. He said 85 new laws had already been implemented by the provincial government under the Nizam-e-Adl Ordinance and now locals were being forced to accept customs duties as well.

“The registration of NCP vehicles will generate up to Rs15 billion in government revenue,” said an official of the district excise office. He claimed a 60% reduction in the cost of registration had been offered on vehicles ranging between 800cc and 1,800cc, while a 72% decrease had been provided on those above 1,800cc.

According to a local survey, there are around 700,000 NCP vehicles in Malakand alone.

Published in The Express Tribune, March 11^th, 2013.