Customs unearths Rs18bln tax evasion in consignments

KARACHI: Pakistan Customs detected more than Rs18 billion of duty and tax evasion involving consignments that used the government warehouse facility, sources in a tax department said on Saturday.

The sources said Directorate of Internal Audit (customs) has detected Rs18 billion revenue leakages due to inefficiency of a customs station in allowing overstay of goods at the bonded warehouse without due tax payments.

“MCC (Model Customs of Collectorate) Appraisement East has failed to initiate action for the recovery of Rs18.27 billion involved on the overstayed goods lying in the bonded warehouse,” the directorate said in a statement.

Under the Customs Act 1969, goods, other than perishable, are allowed to use warehouse facility for six months. For perishable goods, the period is three months.

However, the period can be extended by paying one percent additional duty and taxes for further three months in case of non-perishable items and for one month in case of perishable items.

The customs department said data retrieved from Pakistan Revenue Automation Pvt Limited with regards to goods stored in the bonded warehouse revealed that

even after expiry of mandatory storage period, goods were overstayed for extended periods.

The audit directorate provided the list of 18 goods declaration comprising 9,566 items, which were found overstayed at the bonded warehouse.

The customs collectorate was directed to justify the omission and explained the measures taken to ensure recovery of the unpaid taxes.

The audit directorate also pointed out failure of the collectorate for realising revenue against securities submitted by importers as a guarantee for clearance of goods.

It said the scrutiny revealed that the customs securities obtained against the release of imported input goods under manufacturing bonds/export oriented units under statutory regulatory order (SRO) 450(I)/2001 and SRO 327(I)/2008 for a period of two years were found time-barred.

“The collectorate has failed to initiate any further action for the recovery of the stuck amount of Rs123 million,” the directorate said.

The collectorate was asked to justify the omission and measures taken for recovery of Rs123 million from concerned importers along with possible default surcharge.

Last year, the customs department took action against individuals who lifted goods from government warehouse through misdeclaration, subsequently evading duties and taxes. It said that the tax evasion was organised and done with connivance of warehouse keepers.