FBR unveils new procedures to curb mispricing of cargoes

KARACHI: Tax authorities on Thursday unveiled new procedures to curb mispricing of cargoes under the Afghan transit trade after detecting tax revenue losses.

The Federal Board of Revenue’s (FBR) procedures would ensure safe transportation of transit goods to or from seaports to dry ports to check mis-declaration and under-invoicing. Under the new mechanism, only authorised bonded carriers with their approved vehicles would be able to transport the transit cargoes.

Customs sources said the FBR detected large misuse of transshipment cargoes by the importers, who rendered massive losses to the national exchequer by misdeclaring goods.

The sources said in some occasions pilferage of goods was reported and the authorities were unable to recover the goods. The sources said goods arrived at sea ports were found being cleared without assessment and examination to the goods marked for transshipment. Sometimes goods declared at seaports were changed when declaration made at dry ports, they added.

“In order to plug the loopholes, the FBR issued procedure for transshipment to and from dry ports,” a source said.

Under the new procedure, if a transport unit meets an accident or the transport carriers spend unusual time then trekker operation would generate alert for comprehensive examination of the transport.

Under the procedure for safe transportation, the sealing and desealing of International Security Assistance Force’s (ISAF) containers would be done through customs machine readable seal in Karachi. The route for ISAF cargo would be defined by Pakistan Customs Container Security System (PCCSS).

The FBR also laid down procedure for sealing of transit trade containers, destined for Wagah border station for India, at Torkham-Peshawar and Chaman-Quetta borders.

For transportation of export cargo from dry ports to seaports, the customs authorities would ensure seals are intact at the time of shipment.

The sources said the incidents of smuggling would drastically be reduced with the implementation of PCCSS. Besides, the advance technology of en-route monitoring through trekking devices would prevent revenue losses, they added.

The cross-border trade with landlocked Afghanistan slowed in the recent past due to strict monitoring and increasing cost of transit and bilateral trade. Exports to Afghanistan declined to $789.4 million in the July-March period of FY2020, compared to $885.8 million in the corresponding period a year earlier. Imports, during the period, slid to $111.6 million from $131.7 million.

Around 10,000 containers of Afghan transit trade land at Pakistan’s port every month. The Chaman border was closed on March 3 stranding 1,600 vehicles en-route. Torkham border was closed on March 16 and 400 more vehicles were stranded.