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Karachi, Wed July 12, 2017
ISLAMABAD
TARIQ DERYA
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he exports by Air Freight Unit are gradually increasing during the Financial Year 2016-17 with the value of goods around Rs300.00million against the last two corresponding Financial Years of 201415 and 2015-16. The increase in Goods Declarations (GDs) has been also on the rise
against abovementioned corresponding Qinancial years. According to details told by sources that during the 1st July to 30th June FY16-17, the exports were estimated with the value of Rs26645.00million whereas the GDs, Qiled during said period, was estimated the income of Rs29551million. The average per GD value is estimated at Rs0.9270million per GD during said period. The sources said that increase in exports is a positive caution for
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economy. Sources said that during FY2015-16, the exports section earned business valued Rs22750.00million whereas it processed GDs of Rs25392million. An average per DG value was estimated at Rs0.8960million during FY15-16. During FY2014-15, the Exports Section entertained 22266 GDs whereas it earned business worth Rs18922.01million while the average per GD was shown with the value of Rs0.8498million per GD.
Exports by AFU increase with value of Rs300m during 2016-17
Customs Intelligence files money laundering case against 6 importers
ASO’s brilliant performance due to timely mobilization of squads trafficking’
China smashes drinks smuggling case worth 74 million USD
Hyderabad Customs receives Rs28m thru auction & duty and taxes
The exports by AFU are gradually increasing during the FY 2016-17 | SEE pAgE 01 |
DGCustomsI&Ihasfinallyframedthemoney laundering charges against six importers | SEE pAgE 02 |
ASO Peshawar showed a tremendous performance during FY 2016-17 | SEE pAgE 04 |
Tianjin Customs in north China announced that it has smashed a smuggling case | SEE pAgE 07 |
The MCC, StateWarehouse Hyderabad, earnedRs28mduringJunethroughauction | SEE pAgE 08 |
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Cases for hearing during recent week relisted by Rafique & Dr Nazir Wednesday, July 12, 2017
National
ISLAMABAD: Federal Board of Revenue (FBR) has extended the imposition of withholding tax on non-cash banking transactions by non-filers up to September 30, 2017 from July 01, 2017. The FBR issued SRO 602(I)/2017 with the approval of Federal Minister-in-Charge to extend the 0.4 percent withholding tax on non-cash banking transactions made non-filers of income tax return for three months. The FBR imposed 0.6 percent withholding tax in budget 2015/2016 but it was later reduced to 0.3 percent on July 11, 2015.
customs Intelligence files money laundering case against 6 importers
FAISALABAD
ISLAMABAD
nAEEm ShEIkh
m fAIZAn
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he Anti Smuggling Organization (ASO) has seized foreign 47450 liters diesel and truck trailer worth Rs7,79,6000 involving customs duty and taxes Rs9,68,320 during a successful raids. According to the details, Collector Muhammad Sadiq received information that huge quantity of smuggled diesel was being smuggled out of Faisalabad. He directed Deputy Collector Usman Tariq to take all necessary measures to foil the attempt. The deputy collector formed a team consisting Superintendent Tanveer Raza Naqvi, Inspector Munir Ahmed, Faiz Raza, Asif Hussain and others. The team formed checkpoint near Sadhar and intercepted a suspicious truck trailer bearing registration no: TLZ-909. During the search of the trailer loaded with 299 drums of foreign origin diesel oil. The ASO team seized the oil and arrested Muhammad Naeem son of Rajab Ali at the time of action. The ASO officials said that the agency also impounded the trailer which was used in smuggling.
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irectorate General Customs Intelligence and investigation has Qinally framed the money laundering charges against six importers, M/s Dastagir Traders, Lahore, M/s IC Master, Lahore, M/s Mustafa Enterprises, Lahore, M/s SBS Group of Companies, Lahore, M/s Shahzad Traders, Lahore, and M/s World Fashion Textiles, Lahore. A case has been Qiled with the Customs Special Court of Taxation and Anti-Smuggling. These importers were involved in smuggling of Indian origin grey cloth from dry ports of Lahore, by declaring the same as of Chinese origin and the practice was going on for the last four four years. Import of Indian grey cloth is banned in Pakistan. The importers are involved in transferring a huge amounts of foreign exchange to India through United Arab Emirates. The estimated money laundering amount is US$7 million which is equal to Rs 750 million. The Directorate General has also approached the Financial Monitoring Unit of the State Bank of Pakistan for purpose of money trail to India. It is pertinent to mention here that during the Qirst week of May 2017 the Directorate General Intelligence & Investigations Federal Board of revenue had been busted an organized group of
faisalabad ASo seizes smuggled diesel oil, vehicle during checking
comprising various importers involved in smuggling of banned Indian origin grey cloth into Pakistan and was intercepted 18 containers loaded with Indian cloths, en route from India to Lahore via Dubai.
During initial investigations it had been unearthed that the gang was involved in import of grey cloth from India to Dubai. The Indian cloths were cleared from Dubai Customs and after repacking, the
banned item is re-shipped from Dubai to Lahore via Karachi. The false documents were presented that the cloths have been manufactured in China and shipped to Pakistan via Dubai.
customs tribunal rejects appeal for release of smuggled goods
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KARACHI
m B RAnA
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he Customs Appellate Tribunal has rejected an appeal by Muhammad Irfan, challenging conQiscation of motor oil, spare parts and other items by the additional collector of Customs Adjudication SITE Area Hyderabad. The goods were allegedly smuggled and transported from Lahore to Karachi. A single bench of the tribunal
comprising Syed Tanveer Ahmed, Member Technical-III Karachi, heard the appeal. During the hearing, the tribunal also observed that: “It is established that goods are smuggled as applicant has failed to produce any import documents or even ordinary purchase receipt/ invoice from local market. The case fall in the deQinition of smuggling as duty and taxes have not been paid on the goods. The applicant was willing to pay duty and taxes, on the conQiscated
goods, which conQirms the case that these are smuggled goods, hence, the order of the adjudication authority for conQiscation of goods is upheld and the appeal is rejected on the merits of the case.” According to the customs department, in pursuance of information that foreign origin goods and motor oil, spare parts, bearings etc are being transported for Lahore to Karachi through a container/ trailer having bearing registration no: C-3063 which was in-
tercepted at Toll Plaza Rohri Bypass, on checking the goods were found loaded on the truck, during the searching driver failed to produce any import documents, therefore, the same were seized and notices were issued to the applicant. However, during the hearing, applicant had argued that subject goods were transported form Lahore to Karachi under valid bilties which shows that the seized goods were not smuggled goods Citing Additional Collector of Customs
Adjudication SITE Area Hyderabad and the Superintendent Directorate General of Intelligence and Investigation-FBR as respondents, applicant pleaded the tribunal may set aside impugned judgment of adjudication. Meanwhile, The Special Customs Appellate Tribunal comprising Member, Judicial Nadeem Qureshi and Member Technical Nazim Saleem has reserved orders in two urgent applications filed by Swan International and Zainab Enterprises.
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PESHAWAR
TARIQ DERYA
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he Anti-Smuggling Organization (ASO) of Model Customs Collectorate Peshawar showed a tremendous performance during Financial Year 2016-17 by impounding miscellaneous smuggled goods, narcotics and non-duty-paid vehicles. The MCC Peshawar is divided into three divisions that are North (Peshawar, Mardan, and Noweshra), Kohat division and Hazara division. The ASO North’s performance has been very commendable and impressive during the yesteryear. The performance has been achieved due to timely mobilization of squads on targets. Newly recruitment of sepoys has provided a fresh blood to the force. It is all due to a teamwork which has contributed a brilliant performance to the ASO North. The performance of the Anti-Smuggling Organization (ASO) Peshawar is practically self-sufQicient to carry out operations within its jurisdiction. The ASO collected handsome revenue by impounding contraband items, Non-Duty-Paid (NDP) and offending vehicles during Financial Year (FY) 2016-17. The offending vehicles played a main role in promoting smuggling activities in the region. The ASO Peshawar always tried to discourage the non-tax-paid activities and encourage the legal business activities. The ASO Peshawar impounded 721 vehicles during July to June FY16-17. This was stated by Zakir Muhammad, Deputy Collector ASO Peshawar, while giving an exclusive interview to Customs Today.
tubes valued Rs23.73, 2859 pieces of auto parts worth Rs30.86million and 285 bottles of liquor valued Rs4.52million. During FY16-17, the ASO seized 27,469 litres of smuggled Mobil oil priced Rs10.34million, 78 litres of grease worth Rs0.0162million, 32.821 kg of gold/silver valued Rs125.4million, 246,307 cartons of fake cigarettes worth Rs34.124million, 6,369 pieces of electronics goods valued Rs33.35million, 120 antiques priced Rs1.8million, 250,293 pirated CD/DVDs worth Rs10.067million, 11,698 kg of scrape valued Rs4.27million, 321 blankets priced Rs1.33million, miscellaneous medicines valued Rs2.62million and many other smuggled items. The total estimated value of above said goods is Rs2379.479million. These goods were conQiscated during FY2016-17. The Deputy Collector said the ASO Peshawar impounded 680 Non-Customs-DutyPaid (NDP) and offending vehicles during 11 months (July to May) of FY 2016-17 worth Rs797.180million. y l l tica c a r According to details told by p s s ri on shawa perati Deputy Collector Zakir e o p t o u S o A rry a c Muhammad that performo S o t A t e fficien on. Th i ance of the ASO Peshawar t c i d y s self-su juri ue b s n t i looks good during last 11 e v n i e r with s, dsome months (July to May 16n m a e h t i d te and b a 17) of current Financial r t collec g n co rin les du Year 2016-17. During said nding c u i o h p e v im g period, the ASO impounded 7 endin 016-1 nd off a p 418 offending vehicles val(fY ) 2 D r n a e Y cial ued Rs594.050million finan whereas it impounded 262 NDP vehicles worth Rs383.130million.
During FY16-17, Peshawar ASO seized huge quantity of goods and fetched great revenue to national exchequer. He said the ASO Peshawar impounded 441 offending vehicles worth Rs641.2million whereas it did 280 NDP vehicles valued Rs411.13million during said period. He said the ASO seized 1578,732 yards of foreign origin fabrics priced Rs557.3million, 2,784 kg of betel nuts/poppy seeds worth Rs1.05million, foreign currencies of Rs112.1million, armed ammunition valued Rs0.03million, 132,300 kg of tea priced Rs50.82million, 13,295 tyres and
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Founder & Chairman Zulfiqar Ali Editor Rahil Yasin editor@customsbulletin.com.pk For advertising & subscription marketing@customsbulletin.com.pk www.customsbulletin.com Phones: 042-35781643-4, Fax: 042-35781645 Address: 627, Siddiq Trade Centre, Gulberg, Lahore
EDIToRIAL
problems of textile sector
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ccording to newspaper reports, at least 30 percent textile units have been closed down, over 10,000 workers have lost their jobs and the annual exports of textile products have declined by $3 billion during the last three years of the Pakistan Muslim League-Nawaz government. The All Pakistan Textile Mills Association blames the government for the crisis. Prime Minister Nawaz Sharif had announced a Rs180 billion subsidy and bailout package last year to raise the production capacity of major exportoriented industries, but only Rs4 billion have been earmarked for disbursement during the next one and half years. Earlier, the government had failed to disburse Rs200 billion withholding tax to textile exporters, blocking up to 40 percent of their working capital in the cycle of tax refunds. This has created liquidity crunch in the textile sector. Textile industry is one of the major dollar earning sectors of the country, but it is not only facing challenges at home but also from its competitors in the international market. The country’s annual exports remained $20 billion but had to pay an import bill of $50 billion, thus the current account deficit has crossed $32 billion in the outgoing fiscal year. The irony is that the government has raised duties and taxes at various levels but is reluctant to repay the tax refunds to the exporters. The country is not only losing export markets to growing foreign competitors such as China, India and Vietnam, but also to non-cotton-growing country like Bangladesh. The export sector of the country is also facing the challenges of high cost of production, irrational increase in tax rates, high markup of bank credits and high cost of electricity. Most of the textile units use old machinery, which is imported as scrap and has long been discarded in Europe and the United States. The procedure of refund is also difficult to follow. It requires the exporters to pay all their taxes, get a certificate from the State Bank as well as a confirmation letter that the relevant goods have actually been exported and payments against the goods are received from abroad in the form of foreign exchange. The whole process does not take days or weeks, but months and years before reaching the stage of maturity.
Share of agriculture in gDp T
LAHORE
DR AfTAB AfZAL
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hough Pakistan is moving fast toward industrialization, the major share of the gross domestic product still comes from agrarian economy. Pakistan is one of the major exporters of food items in the world, including rice, grams, citrus fruit and many many other commodities. However, the country’s share in overall rice export has been declining as compared to other countries in the region, including India. The government in the neighbouring country not only supports its farmers and has bigger cultivation farmland, but it also focuses on research and
development to get better quality yields. In Pakistan, inconsistent government policies, lack of research and old methods of cultivation have kept the agriculture sector at the lower ebb. The government support in every economic sector is minimal and all the business is running on the basis of individual efforts. As a result, every sector of the economy is facing challenges, including the export sector. The imports are increasing and the country is facing billions of dollars trade deficit, pushing the country toward another bailout programme from any international donor agency. It seems the policymakers in the country have failed to understand the dynam-
ics of the modern economy. As a matter of fact, the successive governments in Pakistan have failed to encourage the private sector to produce value added goods and all the focus of the officials remained on the export of food items. Ironically, best quality rice, fruit and vegetables of Pakistani origin are freely available at distant lands on nominal prices, but Pakistanis are unable to buy those commodities at home. Rice and mangoes are the worst example of food exports where the nation is deprived of best quality items at home. However, rice and mangoes are available at throwaway prices in Gulf States and European countries. No doubt Pak-
istan has potential to produce quality food and increase per acre yield of rice, pulses, grams and other commodities. It can not only fulfill the local demand, but also feed the world. According to the United Nations, Pakistan could face food insecurity in future and most of the children in the country are still suffer from malnutrition. Unless the corporate sector takes interest in the agriculture sector, it is difficult to enhance per acre yield and launch research and development programmes. It is necessary that the policymakers minimize their reliance on the government funds and involve the private sector in programmes of economic development.
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Volkswagen starts business in Iran Wednesday July 12, 2017
World
TEHRAN: Volkswagen will begin the sale of vehicles in Iran in August. The German automaker will be partnering with Mammut Khodro, a local auto company. Initially, Volkswagen’s Tiguan and Passat models are to be imported under a contract concluded with the Iranian automotive company, the company announced on July 4. The Volkswagen brand will thus again have a presence in the Iranian market after more than 17 years, and is systematically developing further worldwide market potential. The privately-owned local partner Mammut Khodro – also the official Iranian importer for the Group’s Scania brand – will import Volkswagen brand vehicles into Iran and initially distribute them through eight dealers, focusing on the Tehran region.
Thai customs auctions china smashes drinks off seized supercars smuggling case worth 74m uSD BANGKOK
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ianjin Customs in north China announced on Wednesday that it has smashed a smuggling case involving some 5 million liters of wine, beers and mineral water. It was estimated that the drinks involved were worth nearly 500 million yuan(about 74 million U.S. dollars). Tianjin Customs found that a Beijing company’s prices were much lower than the market average at the end of 2016. After two months’ investigation, Qive suspects were caught and key evidence seized. The suspects have allegedly been smuggling drinks through fake contracts and invoices and quoting low prices. It was found that the suspects registered several companies in Beijing and Tianjin. The products smuggled were imported from a dozen coun-
Russia’s digital economy program to require $1.6b he implementation of Russia’s digital economy development program will require funds totaling around 100 bln rubles ($1.6 bln) per year, Communications and Mass Media Minister Nikolai Nikiforov said Wednesday, adding that part of those funds has already been included into the budget. “The current estimation of annual expenses within the operation plan that we will be developing, amounts to around 100 bln rubles. I’d like to stress that a substantial part of those funds has already been included in the federal budget expenditures, we are to consolidate them, set an equal technical policy and equal rules of the game,” he said. According to Nikiforov, the program will also require additional funds from the budget. –CB Report
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tries including the United States, Mexico, Britain, France and Russia. More than 720,000 bottles of drinks worth about 60 million yuan were seized by Tianjin customs ofQicers. Meanwhile, China’s total trade with North Korea has risen despite Beijing’s promise to enforce U.N. sanctions over its nuclear program,
but Chinese purchases of North Korean goods have fallen sharply. Customs data show total Chinese-North Korean trade in the Qirst Qive months of this year rose 15 percent from a year earlier. That is less than the 36.8 percent Qigure earlier reported by the Chinese Customs agency and cited by U.S. President Donald Trump.
Iran’s customs officers seizes big chunk of opium
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sugarloaf containing 2.4 kilograms of opium has been discovered by Customs ofQicers at Imam Khomeini International Airport in the Iranian capital. Customs ofQicers at Tehran’s Imam Khomeini International Airport in the Iranian capital have seized 2.406 kilograms of opium smartly concealed in a sugarloaf, according to a Farsi report by IRIB News Agency. The chunk of opium was shaped into a conical sug-
arloaf, coated skilfully with sugar. Despite efforts to disguise the large piece of opium as a sugarloaf, the customs ofQicer were vigilant enough to Qind and seize it. According to the latest report by the Regional Intelligence Liaison OfQices (RILO) – World Customs Organization, Iran’s Customs Administration (ICA) ranks Qirst worldwide in terms of discovering and seizing narcotics smuggled to and from the country. –CB Report
hai customs officials sold off hundreds of seized luxury vehicles including dozens of supercars although many lots were removed at the last minute after it emerged they were stolen from abroad. Thailand’s role in the global grand theft auto trade has received fresh attention in recent weeks after British police said dozens of stolen supercars had been whisked to the country. Police in Bangkok have since launched a crackdown, seizing dozens of illegally imported vehicles, including at least seven stolen from Britain, and arresting a handful of car dealers. The country places a tax of more than 300 per cent on top-end vehicles a surcharge that investigators say fuels a lucrative black market
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aided by corrupt buyers, dealers and government officials. Thailand’s Customs Department holds an annual auction for vehicles seized in criminal cases. On Thursday, buyers raised bids for a variety of gleaming sports cars, from Ferraris to Aston Martins, Lamborghinis as well as luxurious Rolls Royces and Bentleys. Most were confiscated for being illegally smuggled or because the owners had tried to avoid paying the full import tax, while others had been seized from drug gangs and other criminals. But 95 cars were pulled from the auction sheet in the weeks running up to the bid after checks showed they were stolen from overseas and did not belong to Thailand. Deputy Customs Department spokesman Kreecha Kirdsriphan insisted the oversight was an innocent mistake. “When we discovered that those cars were stolen in those countries, we moved them out from the auction list.
Japan’s gold smuggling jumps again old smuggling into Japan has jumped again according to local media, with the notorious yakuza crime syndicates now joined by ‘amateurs’ exploiting the proQit margin offered to illegal supplies by the country’s tax system. Japan raised its ‘consumption tax’ on goods and services for the Qirst time in 17 years in April 2014, taking the levy from 5% to 8%. Uniquely amongst sales-tax rules worldwide, gold owners can earn back that cost when they sell, paid and then reclaimed from the government by the cash-for-gold shop or bullion dealer involved. In the year ending June 2014,
Japanese authorities made only 8 seizures of smuggled gold, but the number jumped to 177 in the 12 months to 2015 and then 294 in the year to June 2016, with a possible loss in tax revenue of ¥610 million ($5.5m) according to the Finance Ministry’s Customs and Tariff Bureau. A further hike in consumption tax to 10% planned for this year has been delayed to April 2019. June 2017 saw the Japanese customs authorities’ largest gold seizure to date, with the discovery of 206 kilograms of smuggled gold, worth around ¥930 million ($8.4m), at a Qishing port on Japan’s southern island of Kyushu. –CB Report
weetabix seized by new Zealand customs in cereal row
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WELLINGTON
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ustoms ofQicers in New Zealand have seized hundreds of boxes of the breakfast cereal Weetabix after complaints by rival cereal giant Weet-Bix that it could confuse customers. The pallet of Weetabix – about
300 boxes – arrived in a container load of British goods last week, destined for the shelves of the A Little Bit of Britain grocery store in Christchurch, which largely caters to British expats. But New Zealand customs ofQicials detained the pallet at the request of Sanitarium, which claimed the cereal infringed its trademark cereal Weet-Bix, which is a staple in
many New Zealand homes. This week, Sanitarium sent a letter to Lisa Wilson, the co-owner of A Little Bit of Britain, saying it would release her cereal shipment if she placed a sticker over the offending Weetabix label once the item was on her shelves, and blanked out the name Weetabix when she sold the cereal online. Other British stores in the North Island have complied with San-
itarium’s demands, but Wilson has decided to Qight the company, which she accuses of “bullying” her small, family-run business. “They [Sanitarium] walk in and slap an agreement down and it is quite daunting for a very small business they are trying to bully the small guys,” Wilson said. Wilson said her grocery store sold about seven boxes of Weetabix a day to mostly British immigrants.
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Gwadar Customs surpasses revenue collection to Rs3947.385m GWADAR: The Customs Collectorate Gwadar surpasses revenue collection Rs3947.385 million against the assigned target for financial year (FY) 201617. According to the details Customs Collectorate Gwadar was assigned to achieve over all targets of duty and taxes worth Rs22494.41 million for financial year 2016-17 but it has surpassed the revenue collection. The overall target of duty and taxes Rs22494.41 million was assigned to the Collectorate during the financial year 2016-17 and the achievement stood Rs26441.795 million with the increase of Rs3947.385 million during the same period.
Wednesday, July 12, 2017
CUSTOMS BULLETIN
hyderabad customs receives Rs28 million thru auction & duty and taxes HYDERABAD ASLAm AnJum QuREShI www.customsbulletin.com
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he Model Customs Collectorate, State Warehouse Hyderabad, earned Rs28million during June through auction and duty and taxes of vehicles and miscellaneous items impounded by Ant-Smuggling Organization Hyderabad. Following strict instructions by Hyderabad Customs Collector Akhlaq Ahmad Khattaq under the supervision of Additional collector Rehmatulah Vistr, the ASO team conducted various anti-smuggling activities to check the trafQicking. The Hyderabad Customs presented a number of vehicles for auction and generated Rs4.3million during April 2017 while other goods attracted suitable bids. Other miscellaneous goods, including white cumin and non-duty-paid different brands of cigarettes and smuggled item of cloths, black pepper, electronic item of LED, tea and tyres, were presented for open bids of auction and customs duty following all duty taxes including customs and import duty of Rs08.4million, sale proceed of Rs05.8million, regulatory duty of Rs01.9million, Qine and penal-
ties of Rs02.9million, Motamar AlamE-Islami (MI) deposit of Rs988904, total customs duty of Rs01.7million, sale taxes on imports of Rs03.0million, sale tax on imports (Net) and federal excise duty on imports goods (FED) of Rs01.4million and advance
income tax of Rs02.6million. So the total collection is Rs28million during the Qirst July 2016-17 to June 30 FY 2017. The tax evasion was detected by Hyderabad Customs State Warehouse under the supervision of Deputy Collector (SWH). MCC Hy-
derabad Mushtaq Shahani and his team comprised Superintendent Nadeem Ahmed Usmani, State Warehouse In-charge Inspector Abdul Rauf Qureshi, Inspector Tariq Ghani, Sharif sheikh, Aslam Khan, Mola Bux, Muhammad Yousuf, and Havaldar
Muhammad Hussain. They added that the anti-smuggling campaign was in full swing in the region following the direction of the Federal Board of Revenue Collector Akhlaq Ahmad Khattaq to streamline the national economy.
fBR to collect Rs10b additional revenue share transactions KARACHI
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ederal Board of Revenue (FBR) is likely to collect Rs10 billion additional revenue from taxes on shares trading in the current fiscal year of 2017-18. The government introduced several changes in tax rates and Income Tax Ordinance 2001 for tax year 2018 in order to generate
additional revenue from the equity market instead of burdening public ahead of general elections next year. Government, through Finance Act 2017, increased tax on dividend on shares income to 15 percent from 12.5 percent. Tax rate on dividend received from mutual funds was raised to 12.5 percent from 10 percent earlier, but the increased rate is applicable only if dividend income is above Rs2.5 million. The official said taxes on stock market in Pakistan are lower as compared to regional markets. Yet, taxes on se-
curities were also cut in the current fiscal year’s budget to pro-
mote stock market, added the official. The government cut tax on
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services provided by the stock exchange to two percent from eight percent. FBR official said the government decided to slap 15 percent tax on capital gains for filers and 20 percent for nonfilers in order to bring harmony. The uniform rates have replaced rates, which are variable according to holding periods. These rates were ranging between 7.5 percent to 15 percent and 11 percent to 18 percent for filers and non-filers, respectively. The FBR official said new capital gain rates are applicable on securities acquired after July 1, 2016.