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Karachi customs collects Rs602bln in 10 months

Business

May 5, 2019

KARACHI: Revenue collection from foreign trade posted a nominal growth of 1.42 percent due to restriction imposed by the government to discourage import of luxury and non-essential items, data showed on Saturday.

According to revenue collection data obtained from the Model Customs Collectorates (MCCs) Appraisement East and West, revenue collection increased to Rs602.46 billion during July-April 2018/2019, as compared with Rs594 billion in the corresponding period of the last fiscal year.

The government had taken a number of measures to discourage imports of luxury and non-essential items, including high rate of regulatory duty during the last budget and later in the Finance Supplementary (Amendment) Act, 2018.

Further, the condition of foreign exchange imposed on clearance of motor vehicles also affected revenue collection at import stage.

The break-up of collection showed that MCC Appraisement East posed a decline of two percent during the first 10 months of the current fiscal year.

The collectorate collected Rs226.18 billion during July-April 2018/2019, as compared with Rs231.45 billion in the corresponding period of the last fiscal year.

The collection of customs duty posted three percent growth to Rs106.38 billion as compared with Rs103.47 billion. However, sales tax collection fell by seven percent to Rs85.45 billion, as compared with Rs91.39 billion during the period under review.

Sources said the lower rates of sales tax on petroleum products had negatively affected the sales tax collection during the period.

The collectorate collected income withholding tax and federal excise duty of Rs33 billion and Rs837 million, posting decline of six percent and 19 percent, respectively.

However, the collection of MCC Appraisement West posted four percent growth to Rs376.28 billion during July-April 2018/2019, as compared with Rs362.35 billion in the same period of the last fiscal year.

The collectorate collected Rs145.26 billion as customs duty, Rs170 billion sales tax, Rs59.37 billion income tax and Rs1.21 billion as federal excise duty.

Both the collectorates have failed to achieve assigned target for the period July-April 2018/2019. MCC Appraisement West was assigned Rs416.7 billion collection target, but it achieved 90 percent of the target. MCC Appraisement East also achieved 90 percent of its assigned collection target of Rs252.26 billion.

The Federal Board of Revenue (FBR) in its recent presentation to the ministry of finance projected customs duty loss of Rs57 billion due to facilitation measures taken in the budget.

The FBR estimated Rs10 billion losses only on change in payment system on motor vehicles import.

Further, the FBR projected Rs7 billion duty loss due to facilitation measures taken through Finance Supplementary (Second Amendment), Act, 2019.

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