Imported cars: APMDA proposes relaxing age limit

Suggests vehicles up to 10 years old be allowed to enter country

KARACHI: All Pakistan Motor Dealers Association (APMDA) Chairman H M Shahzad has urged the government to allow commercial imports of used vehicles of up to 10 years of age.

While presenting its budget proposals in a letter to Finance Minister Ishaq Dar, APMDA – the representative association of car importers – said that allowing commercial imports, in addition to the existing ones, would bring the business of imported used vehicles into the tax net and will help the government expand the tax base.

According to the proposal, the association suggested that only certified members of the APMDA should be allowed to import used vehicles on commercial basis for the sake of transparency.

It was 2005-2006 when the government allowed the import of used cars after 12 years. However, the previous government reduced the import limit from five-year-old to three-year-old cars in December 2012, which helped local assemblers to monopolise prices and car supplies.

The existing schemes for the import of used vehicles are for the facilitation of overseas Pakistanis.  It is recommended that in these schemes, there should be no restriction of age limit for the imported vehicle.

The regulatory duty income of the government has been reduced which is verifiable from all the collectorates of customs due to the current measures on car imports.

It may be pertinent to point out that the Amnesty scheme of March 2013 of the previous government has resulted in regularising 52,000 smuggled vehicles of all engine capacities without restriction of age limit, the proposal added.

Smuggling is done to avoid taxes or age restrictions placed on different cars. To avoid this in future, the government should review the current policy and reduce the tax rate and increase the age limit of used cars. This will make smuggling less attractive and also increase the government revenue substantially, said the association.

Published in The Express Tribune, March 15^th, 2015.

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