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PAKISTAN’S FIRST INDEPTH NEWSPAPER ON CuSTOMS
FBR endeavors to curb menace of corruption on PM directives
Curbing the menace of corruption is on top of the agenda of the present government. Prime Minister Mian Nawaz Sharif recently issued directives to Revenue Division and Federal Board of Revenue to conduct proper screening and strict scrutiny to purge the lines of corrupt and inefficient elements in their ranks. After these firm directives, Revenue Division and FBR gave clear directions to the officers and staff working under their administrative control to perform their assigned duties professionally. FBR Chairman Tariq Bajwa also stressed this point last week in a press briefing saying that there would be zero tolerance on corruption among FBR officers, adding that the Board took decision to suspend two officers of Customs in Karachi. Similarly, Member Customs also held a number of meetings in Islamabad and Karachi with chief collectors, collectors, additional collectors, deputy collectors and assistant collectors, and called for making an effective strategy to eradicate corruption from the department and enhance efficiency of the officials. | SEE PAgE 6-7 |
Karachi, Tue Sept 03 - Mon Sept 09, 2013
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KARACHI
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Fulfilling all the requirements including capacity building and training will ultimate improve the performance of MCC Preventive.
hairman FBR Tariq Bajwa and Member Customs Nisar Muhammad Khan gave clear instructions for strengthening the enforcement system of Model Customs Collec torate (MCC) Preventive. This was stated by Chief Collector (Enforcement) Muhammad Yahya during an exclusive interview with Customs Today at his office. The Chief Collector (Enforcement) admitted that MCC Preventive was facing lack of manpower and modern equipment. However; the situation would be improved very soon in the department. “Despite all odds at MCC Preventive, the collectorate is utilising its available resources in best way”, the Chief Collector added. To a query, Chief Collector (Enforcement) Muhammad Yahya said fulfilling all the requirements including capacity building and training will ultimate improve the performance of MCC Preventive. He further informed that non-availability of suitable men in place of outgoing veterans and experienced officials is another dilemma, which affects the performance of MCC Preventive. Replying a question, Muhammad Yahya said that Pakistan Maritime Security Agency is one of the best agencies of the country and Customs has no reservations in order to conduct joint raids against smugglers in deep sea. Answering another question, Chief Collector Muhammad Yahya denied any missing link between Customs officials and informers, who leak out the information against smugglers. “We have a well-coordinated system of exchanging information between Customs officials and informers, adding that MCC Preventive strives hard to foil smuggling bids”, he added. He further said that high officials in FBR and Pakistan Customs are determined to make MCC (Preventive) Enforcement more effective in order to combat rising smuggling bids and trafficking.
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02 NATIONAL
SEPTEMBER 03 - SEPTEMBER 09, 2013
Chinese customs seize 169 smuggled bear paws
TONGJIANG: Authorities have busted a bear paw smuggling ring in northeast China's Heilongjiang Province, arresting five people and seizing 169 bear paws, local customs officials said. Customs officers in the city of Kiamusze received a tip-off that a stash of bear paws had been smuggled into China through the border city of Tongjiang and transported to the provincial capital Harbin. Kiamusze customs officers arrested three suspects in Tongjiang and another in Harbin.
Strong surveillance of ATT & Nato supplies under way: Khawar Farid Maneka, Dg Transit Trade On our part we have a brilliant record up to 96 percent of safe delivery across the border and the remaining four percent is also checked thoroughly to avoid any misuse; ATT does not make any impact on our revenue because Afghanistan being a landlocked country has the privilege to use the corridor for its goods movement
KARACHI
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he movement of consignments under Afghan Transit Trade (ATT) as well specifications of NATO supplies are strictly monitored with highly sensitive equipment leaving no room for any foul play, said Khawar Farid Maneka, Director General Transit Trade of the Customs in an exclusive interview with Customs Today. Replying to a question, Maneka said that it is our responsibility to monitor and ensure transparent movement of the consignments till the goods are delivered across the border; however, return of these goods within tariff area of Pakistan is certainly an act of smuggling. He added that plugging the loopholes to check smuggling of the goods under Afghan Transit Trade into Pakistan is the responsibility of different agencies and forces which are supposed to check these illegal movements
back into Pakistan, said Maneka with full confidence. The reports regarding misuse of the Afghan Transit Trade facility are blown out of proportion
by the people not fully aware of the functions of the transit trade facility, he said adding that the facility might be used for personal benefits by some quarters but it does not come under the domain of his department, as there are other agencies responsible to weed out this menace causing harm to the economy of Pakistan and Afghanistan as well. He said that on our part we have a brilliant record up to 96 percent of safe delivery across the border and the remaining four percent is also checked thoroughly to avoid any misuse. He however clarified that the Afghan Transit Trade does not make any impact on our revenue because Afghanistan being a landlocked country has the privilege to use the corridor for its goods movement from Pakistan under Geneva Convention. However, the transit trade carries enormous benefits to the allied segments of the private sector such as the cost of transportation of the goods, and a number of other aspects which help generate economic activity
for the private sector in Pakistan. Discussing the economic agenda and the policies of the government, he observed that trade, both domestic and external, enjoys top priority which may open tremendous economic opportunities as a spillover of transit trade to China and would be generating sufficient revenue to give a turnaround to the economy in Pakistan. Replying to another question regarding monitoring of NATO supplies, he said that NATO supplies do not involve movement of arms or ammunition except provisions of daily use items for the NATO forces, we are technologically well-equipped for screening of the supplies.
It is our responsibility to monitor and ensure transparent movement of the consignments till the goods are delivered across the border; however, return of these goods within tari area of Pakistan is certainly an act of smuggling
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SEPTEMBER 03 - SEPTEMBER 09, 2013
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04 NATIONAL
SEPTEMBER 03 - SEPTEMBER 09, 2013
China intensifies crackdown on smuggling
Chinese customs authorities put 260 smuggling cases on file for investigation between July 1 and Aug. 27 in a nationwide crackdown. The cases involved 9.64 billion yuan (1.58 billion US dollars), the General Administration of Customs (GAC) said. Liu Xiaohui, head of the administration's anti-smuggling bureau, said the GAC is joining hands with ten government agencies including the Ministry of Public Security in an intensive six month campaign.
Govt plans to jack up tax-to-GDP ratio up to 5pc
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he PML-N led government plans to jack up tax-to-GDP ratio in the range of 3 to 5 percent over next 36 months under IMF’s bailout package of $6.6 billion.The Federal Board of Revenue (FBR) has finalised broadening the tax base with the blessing of political leadership under which stringent measures will be taken to nab tax dodgers. Finance Minister Ishaq Dar has given green signal to FBR for moving ahead with iron hand against those who found involved in tax evasion. But it is yet to see how the PML-N government takes tough actions against its own voters as tax evasion basically prevails at major urban centres where Nawaz Sharif enjoys popular support.The tax-to-GDP ratio, which fell below 9 percent of GDP, in the last financial year 2012-13 as FBR’s tax collection nosedived to Rs 1942 billion against the initially envisaged target of Rs 2381 billion, witnessing a shortfall of Rs 439 billion. FBR in its whole history never witnessed such a massive revenue shortfall and it will have to achieve 28.4 percent growth in the current fiscal year for materialising the desired target of Rs 2475 billion by end June 2014.“Under the broadening of tax base exercise, FBR has sent 10,000 notices to potential tax dodgers last month (July 2013) and another 15,000 notices will be sent during the ongoing month,” a senior FBR official said. By end September 2013, FBR plans to send 40,000 to 50,000 notices to potential dodgers with the purpose to generate demand of billions of rupees and then efforts would be made to maximise revenue collection in months ahead.“The newly-appointed Chairman FBRTariq Bajwa has also focused upon effective monitoring of withholding taxes, plugging leakages on account of input adjustments of sales tax, curbing under-invoicing and over-invoicing and controlling smuggling to maximise revenue collection and achieving the set target of Rs 2475 billion by end of the ongoing financial year. —CT Report
Imtiaz Ahmed elected president of PCOA UGANDA
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mtiaz Ahmed, PS-20 Officer of Pakistan Customs Service, has been elected unopposed as president in the elections of Pakistan Customs Officers Association. Other office-bearers who were also elected unopposed include: Junaid Akram,Vice President; Basit Maqsood Abbassi, General Secretary; Mohammad Raza, Joint Secretary and Ms. Shahnaz Maqbool,Treasurer. All members of managing committee also elected unopposed. The members include: Dr.Wasif Memon, Dr. Arslan Subuktageen, MoeenVani, Karam Elahi, Honak Baloch, Ms. Zeba Hai, Kamran Rajar and Khalid Jamali.
FBR delays issuing of
new Income Tax Form compulsory for all in the budget. They said that exemption would be available for individuals on threshold of Rs 400,000 only in terms of income tax assessment, but the filing of tax returns was made mandatory for all, whether income tax was deducted or not in a tax year. The tax experts said that in 2012, only 800,000 returns were received by the tax authority and after these changes in tax law, the number of tax returns was expected to increase to near 1 million in 2013. They said that the launching of amended ITF was delayed as the Board might be working on the Annex-D, which was unveiled in 2012 but delayed till June 30 this year. It has now made part of the income tax law. They said it was expected that all tax returns would not be filed before Sept 30 this year and the Board would have to extend the deadline for at least 30 days.
ISLAMABAD
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ederal Board of Revenue (FBR) has not yet unveiled newly-amended Income Tax Form (ITF), which can create difficulties for taxpayers and auditors in filing of income tax returns. The tax experts disclosed that in budget 2012-13, the income tax law was amended and after this, all (including salaried and nonsalaried) taxpayers have to file income tax returns along with wealth statement for this year irrespective of the income or value of the assets. The experts further revealed that any taxpayer had no exemption from filing of returns as the filing of income tax returns along with wealth statement had been made
Customs foils smuggling bid, seizes 9,000 litres of HSD KARACHI
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odel Customs Collectorate (MCC) Gwadar has foiled a bid to smuggle 6,250kgs of plastic granule and also seized over 9,000 litres of smuggled Iranian high speed diesel (HSD) in two different raids. Sources said that the customs officials have successfully carried out operations despite bad law and order situation in Gwadar and nearby areas. “Besides the resistance from the devious elements, the Customs Department has also controlled the law and order in the area and normalised the situation,” the source added. The consignment of granules, worth more than Rs 1.5 million, was loaded on a bus which was heading to Quetta. In another raid, MCC mobile squads at Jiwani and Gwadar seized more than 9,000 litres of smuggled Iranian HSD and Pakistani cigarettes along with vehicles, worth more than Rs 2.7 million.
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Sino-Pak corridor to enhance regional progress
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ISLAMABAD
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he China-Pakistan Economic Corridor Secretariat has been formally inaugurated at the Planning Division with an aim to ‘transform the strongest political relations into economic relations’. The secretariat was jointly inaugurated by Federal Minister for Planning and Development Ahsan Iqbal and Zhang Xiaoqiang, the vice chairman of National Development and Reforms Commission (NDRC), China. The inaugural meeting of Joint Cooperation Committee (JCC) of the corridor was held between Chinese delegation -comprised of high government officials and prominent entrepreneurs headed by Xiaoqiang and representatives of different ministries led by Iqbal. In his opening remarks, Iqbal highlighted the need of transforming political relations into economic relations because they are of “great significance for the people of Pakistan”. He said the corridor from Kashgar to Khunjerab and Gwadar was not merely a transportation link, but it was energy
and telecommunication corridor too. China's development experience of past three decades is a role model for the people of Pakistan, he added. He said that after the withdrawal of US troops from Afghanistan, there would be a vacuum, which could only be filled by generating economic opportunities in the region to create jobs and economic alternatives. He said the economic corridor was of high potential for the people of Afghanistan in this regard. “The corridor has bilateral links with India, Afghanistan and Iran and would bolster the development in South Asia and the Middle East,” he said. Iqbal said, “Gwadar offers strategic opportunities not only to Pakistan and China but also to the rest of the world. We are keen to have Chinese investment in energy and infrastructure. We are already working with Chinese companies in Gadani coastal energy park and in solar energy projects.” Xiaoqiang said both countries had great potential for economic cooperation in future. He said the corridor “will not only promote trade but also bring stability in the region by creating jobs”. “This project is important
Gwadar offers strategic opportunities not only to Pakistan and China but also to the rest of the world. We are already working with Chinese companies in Gadani coastal energy park and in solar energy projects, says Ahsan Iqbal
for the whole region,” he added. Briefing the delegation about functions and working of the Planning Commission, Iqbal said: “We are in a phase of medium- and long-term planning to set targets for moderately good growth in GDP and living standard by 2025 and want to transform economy based on knowledge and expertise.” He said that besides modernising infrastructure, energy was the government's focal point in long-term policies. “We want to transform our exports from commodity into value-added sector by the help of technology and in our long-term planning private sector will be the leader of growth,” He said special economic zones would be set up along with the corridor. He also asked Xiaoqiang to raise the ceiling of investment by Export-Import (Exim) Bank and China Development Bank from $3 billion to $10b for Pakistan’s development projects. Xiaoqiang said China would invest in energy, transportation, infrastructure and export-based industries. He also hoped the landmark project would serve as backbone for Pakistan's economy.
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06 SPECIALREPORT
SEPTEMBER 03 - SEPTEMBER 09, 2013
FBR ENDEAVORS TO CURB MENACE OF CORR | FROM PAgE 1 |
LAHORE/KARACHI/ISLAMABAD
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fter these recent developments, Customs Department is strictly following these directives and has started fight against corruption to unearth old frauds and prevent potential frauds in future. According to details, Customs Intelligence detained 3 containers on 16 August (Friday) at Pakistan International Container Terminal (PICT). After initial investigation, it found that the containers were cleared without examination by mis-declaration of GDs (Goods Declarations) mentioned with different items including artificial ornaments, toilet soaps, fairness creams, towels, cosmetics, hosiery products & other items and booked on the name of A to Z company and H A Karim International. Sources revealed that a self-proclaimed clearing agent Mian Tahir played a vital role in order to clear these consignments. In the meantime, R & D Department of Customs opened 15 recovery cases from July to August against these importers having GD Nos: 7724, 7720, 7712, 7715, 7718, 9141, 9153, 9136, 9130, 9150, 9142, 9147, 9155, 9159 and 9163. Sources in Customs House, Karachi told our correspondent that Mian Tahir had close links with Assistant Collector Aftab Ahmed and cleared around 43 GDs in just two months i.e. (July and August) by using Aftab’s WeBOC ID and password. Unlike before, now Customs De-
Spokesperson of Customs Intelligence Department confirmed that in the wake of credible information, the regional office at Karachi intercepted and seized 3x40 containers of miscellaneous items imported by H.A Karim International and A to Z company.The consignments were cleared through yellow channel without examination.
partment has started taking notice against its own ‘corrupt’ officials. When contacted Model Customs Collectorate (MCC) Appraisement said that it has issued an order of “off-duty” against its own Assistant Collector Aftab Ahmed and an inquiry has been initiated against Appraisers Jam Akram and Rasheed Khan. Member Customs Nisar Muhammad Khan seems very optimistic about the performance of FBR and Customs Department and is highly convinced that FBR is now heading towards right direction under the competent and proficient leadership of its chairman Tariq Bajwa. Mr Nisar, while talking to Customs Today about the case of tax evasion by the importers, said that the case would be investigated as per law. Expressing his complete satisfaction, he said that now all the departments are working efficiently. Any act against the rules and regulations would not be tolerated, he added. Commenting on the above-mentioned case of tax evasion, DG Investigation & Intelligence Riaz Khan told Customs Today that there is no room for corrupt elements. Everybody is equal before law and no one is above the law. We are working for betterment of Pakistan. Our department is also working in that direction, he added. When contacted the spokesperson of Customs Intelligence Department confirmed that in the wake of credible information, the regional office at Karachi intercepted and seized 3x40 containers of miscellaneous items imported by H.A Karim International and A to Z company. The consignments were cleared through yellow channel without examination. Assessment Officer initially marked that multiple items were declared without proper specification, description, size, material, origin, brand, packing, quality and net weight etc,. He said that the examination request was rejected by Assistant Collector (Assessment) Aftab Ahmed Khan and GDs were completed and assigned to gate out while the same containers were intercepted and detained by the Directorate. He also confirmed lodging of FIR against the culprit. Director Customs Intelligence & Investigation Manzoor Hussain Memon is striving hard and taking a number of initiatives to curb the menace of corruption to reduce the tax evasion and increase the revenue for the exchequer. When contacted to get details about the above-mentioned case, Manzoor Hussain Memon confirmed that the Customs Intelligence has written a letter to Federal Board of Revenue in or-
der to get permission to involve the Assistant Collector in the ongoing investigation. "The Intelligence officers are carrying out investigation into the matter without any pressure, however; phone calls of some influentials are being received," the Director added. Giving details about the recent operation of the Directorate of Customs Intelligence & Investigation, Additional Director Customs I&I, Mumtaz Khoso informed Customs Today that the Customs Intelligence and Investigation has detained three containers of importers Sheikh Khurram Shahzad (owner A to Z) and Azfar Javed (owner H A Karim International). Khoso confirmed that among the
detained containers, two belonged to A to Z company and third H A Karim International. “During joint investigation, it was revealed that 33 different items were present in first container, 40 in the second container and 52 different
items found in thir ever; the Goods D displayed 18 diffe container, 16 in sec container,” Additi toms I&I disclosed Providing the d
On just three containers, these importers h containers are detained for investigation, i containers too then it is possible they had been evad which could open doors for further investigation into the scam.
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SPECIALREPORT 07
SEPTEMBER 03 - SEPTEMBER 09, 2013
RUPTION ON PM DIRECTIVES
rd container. HowDeclarations (GDs) erent items in first cond and 20 in third onal Director Cusd. details of complete
There would be zero tolerance on corruption among FBR officers, adding that the Board took decision to suspend two officers of Customs in Karachi – FBR Chairman Tariq Bajwa
breakup of the duty obtained and tax evaded, the Additional Director informed that on first container duty of Rs 4.63 lakh was submitted instead of Rs 34 lakh, on second container the tax levy of Rs 4.34 lakh was submitted instead of Rs 27 lakh and on third con-
have evaded Rs 82 lakh and seven more f they are proved to have evaded duty on these 7 ing duty on their imported goods for several years o the case and take Customs Department to unearth
tainer, the duty of Rs 4.67 lakh was submitted instead of Rs 35 lakh. He further informed that 7 other containers of these two importers are under examination by the Model Customs Collectorate (MCC) East. On just three containers, these importers have evaded Rs 82 lakh and seven more containers are detained for investigation, if they are proved to have evaded duty on these 7 containers too then it is possible they had been evading duty on their imported goods for several years which could open doors for further investigation into the case and take Customs Department to unearth the scam. “We have registered 2 FIRs against the accused namely Khurram Shaikh and Azfar Javed involved in the case for evading huge tax levy, adding that these importers belonged to Islamabad and Rawalpindi,” he added. “Valuation ruling has also been violated in such cases and the Customs Intelligence is investigating the matter”, he added. Khoso further said that the Customs Intelligence has already completed seizer procedure in the matter. “We have two main priorities in the said case as per the directives of highups that is to recover the evaded tax levy and arrest the culprits involved in it”, Additional Director Customs I&I revealed. “We have clear directives from the top brass of FBR and Customs Department to eliminate the corrupt practice”, he asserted. He further informed that the investigation is going on smoothly and it is hoped that the procedure would be
The case would be investigated as per law. Any act against the rules and regulations would not be tolerated –Member Customs Nisar Muhammad Khan
The Intelligence officers are carrying out investigation in the matter without any pressure, however; phone calls of some influentials are being received –Director Customs I&I Manzoor Memon
On first container duty of Rs 4.63 lakh was submitted instead of Rs 34 lakh, on second container the tax levy of Rs 4.34 lakh was submitted instead of Rs 27 lakh and on third container, the duty of Rs 4.67 lakh was submitted instead of Rs 35 lakh –Additional Director Customs I&I, Mumtaz Khoso
There is no room for corrupt elements. No one is above the law. We are working for betterment of Pakistan. Our department is also working in that direction –Dg I&I Riaz Khan completed within 30 days. “We have also clear directives in order to eradicate such mafia, causing huge losses to national exchequer”, he maintained. When contacted Assistant Collector Aftab Ahmed, who is involved in the case, said that he is “off-duty” now and could not comment over the said matter. One of the office-bearers of Karachi Customs Agents Association (KCAA) said that Mian Tahir is not a listed clearing agent and even not enrolled with Association. “Mian Tahir did not visit the office of KCAA ever in his career and persons like him by disguising them as clearing agents are tarnishing the image of clearing agents as well as the Association”, he added. Amir Sheikh (owner of A to Z Hosiery) and ‘relative’ of accused Khurram Sheikh (owner of A to Z company) told Customs Today that he has nothing to do with these frauds. When contacted, Khurram Sheikh (owner of A to Z company) and main accused in the case said that detaining of their containers seems to be a tactic to pressurize them, he added. Customs Today team at Karachi and Islamabad chased this investigative story at length to dig into details of what steps FBR and Customs high-ups are taking to avoid hefty losses to the exchequer through frauds in lieu of the directives of Prime Minister Nawaz Sharif.
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08 EDITORIAL
SEPTEMBER 03 - SEPTEMBER 09, 2013
Founder & Chairman Zulfiqar Ali Editor Nasim Ahmed editor@customstoday.com.pk For advertising & subscription marketing@customstoday.com.pk +92-322-3370002 www.customstoday.com Phones: 042-35781643-4, Fax: 042-35781645 Address: 627, Siddiq Trade Centre, Gulberg, Lahore
EDITORIAL
RAISINg TAX REVENuE
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ver since the new FBR Chairman,Tariq Bajwa, took over, tax revenue has shown a positive growth trend. According to the latest report, there has been a 25 percent increase in tax revenues since the beginning of the fiscal year thanks to a number of new tax collection initiatives taken by the Board. These measures, among others, include a hike in sales tax from 16 to 17 percent. In July, the first month of the fiscal year, the rise in tax collection is estimated at Rs 10 billion. Experts are of the opinion that the new measures have the potential to generate Rs207 billion during the current fiscal year. Pakistan has one of the lowest tax collection rates in the world and IMF and other international donors want the government to do more to tackle rampant tax evasion, particularly by its wealthy elite, to ensure long-term economic stability. Needless to say, in any drive to improve tax collection, FBR has the central role to play. But year after FBR has failed to deliver. The new Chairman has been trying hard to change the image of FBR by making it a transparent, corruption-free, efficient and effective organization. While, on the one hand, he has come down hard on corruption at the operational levels, on the other, he has been bending his efforts to mop up more resources through better assessments, plugging of leakages and better supervision and management. In his numerous meetings with senior level officers he has made it clear that he will not tolerate corruption in FBR. At all key positions, he has appointed officers with a clean record. But all FBR efforts will come to naught if at the policy level major loopholes are not plugged. Agriculture remaining out of the tax net means colossal loss to the national exchequer. It is also necessary to remove dichotomies, discretions and exemptions like SROs which distort the system and render it weak and unworkable.The rich don’t pay their taxes with no questions asked. According to a newspaper report, about 67 percent of our parliamentarians don’t pay taxes. In order to remove the anomalies, it is important to re-examine the whole taxation machinery in its totality – its philosophy, objectives, operational mode and existing processes – in order to design and implement long-term remedial measures. A few years back, under the Tax Administration Reforms Programme, millions of dollars given by donor agencies were spent to reform the tax system but no improvements were seen. The effort was in vain. The time has come to make the taxation machinery pro-active, effective and people-friendly. Voluntary tax compliance needs to be encouraged but for this to happen an effective system of deterrence will have to be put in place. At present the privileged classes enjoy huge tax free benefits, with the burden mostly on the middle classes - businessmen and the salaried people. This imbalance should be corrected. Taxes due should be collected from all, whether big or small, and the system should be free of any kind of discrimination. Only then can we expect tax revenue to rise to the desired level.
FBR revenue collection on the rise F
BR has so far increased its revenue collection by 35 percent by collecting Rs 239 billion in July-August period of the current fiscal year against a collection of Rs 176 billion in the same period of the last financial year. FBR has so far collected Rs 116.223 billion during first 28 days of August 2013 as compared to Rs 70.007 billion during the same period last fiscal, registering a growth of 66 percent. FBR collected direct taxes to the tune of Rs 29.631 billion; sales tax Rs 66.856 billion; FED Rs 7.591 billion and customs duty Rs 12.144 billion. According to provisional figures of revenue collection compiled by FBR, the Board netted Rs 60.376 billion in shape of direct taxes during this period against Rs 43.096 billion in the same period last fiscal, reflect-
ing an increase of 40.1 percent. The collection of Withholding Tax (WHT) at the import stage went up to Rs 13.678 billion during July-August 29, 2013 against Rs 13.722 billion in the corresponding period of last fiscal year. The revenue collection in
view against Rs 9.606 billion in the same period last fiscal, showing an improvement of 42.3 percent. Customs duty collection stood at Rs 28.427 billion during July-August 29, 2013 against Rs 27.077 billion in the corresponding period of last fis-
FBR has so far collected Rs 116.223 billion during first 28 days of August 2013 as compared to Rs 70.007 billion during the same period last fiscal, registering a growth of 66 percent. FBR collected direct taxes to the tune of Rs 29.631 billion; sales tax Rs 66.856 billion; FED Rs 7.591 billion and customs duty Rs 12.144 billion shape of sales tax remained Rs 136 billion during July to August 29 period against Rs 97.104 billion in the same period of last fiscal, reflecting an increase of 41 percent. The collection of the federal excise duty was Rs 13.673 billion during the period under re-
cal, reflecting an increase of 5 percent. FBR has paid refunds and rebates to the tune of Rs 17.209 billion during the period under review as compared to Rs 17.136 billion during the same period last fiscal, depicting an increase of 0.4 percent.
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PICTORIAL
SEPTEMBER 03 - SEPTEMBER 09, 2013
FBR seizes PESS bank accounts, recovers Rs55m unpaid tax liabilities
LAHORE: Federal Board of Revenue (FBR) has seized 10 accounts of Punjab Employees Social Security (PESS) and recovered Rs55 million tax liabilities. The PESS owed Rs75 million as tax liabilities from 2003 to 2006 and was not paying taxes. During this period, the Board had been corresponding with the PESS to recover the payable tax amount, a source revealed. An official said, “Despite repeated attempts, the PESS was not ready to pay off its tax liabilities. The Board has now recovered Rs55 million confiscating PESS accounts.
ISHAQDAR,OTHERDIGNITARIESATTENDWEDDINGCEREMONyOF FINANCESECRETARY’SDAUGHTER
— Exlusive Customs Today photos
09
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10 KARACHI
SEPTEMBER 03 - SEPTEMBER 09, 2013
Foreign reserves stand at $10,390.5m
— Exlusive Customs Today photo
LAHORE: The total liquid foreign reserves held by the country stood at $ 10,390.5 million on August 23, 2013. According to break-up figures, foreign reserves held by the State Bank of Pakistan (SBP) stood $ 5,203.6 million while net foreign reserves held by banks (other than SBP) were recorded at $5,186.9 million, according to the press statement issued by SBP.
KarachiCustoms AgentsAlliance to win elections with thumping majority: Saifullah Khan KARACHI
— Exlusive Customs Today photo
CuSTOMS TODAY REPORT www.customstoday.com
resident Karachi Customs Agents Association (KCAA) Saifullah Khan said that his panel would definitely win the upcoming elections of the association with “thumping majority”. In an exclusive interview with Customs Today, Khan said that Karachi Customs Agents Alliance was winning the elections for four consecutive years since KCAA got freed from clutches of ‘mafia’ in 2008. President KCAA said that the current office-bearers of the association have worked for the betterment of clearing agents during their tenure. “We stand shoulder-to-shoulder with clearing agents in difficult times and will continue to resolve their issues related to clearance of goods”, he added. Commenting on Customs Department, Saifullah Khan said that it is one of the best departments of the government, generating huge revenue for national exchequer. He further said that high-ups of Customs Department are optimistic and willing to uphold morale of other Customs officials, adding that KCAA will extend full support to them in this regard.“Rule of law should prevail at Customs Department and best officials be deputed in Audit, Post Clearance Audit (PCA) and Risk Management Cell (RMC)”, Khan added.
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Customs Today is a unique and first English newspaper of its own kind, having good printing quality and following policy of constructive criticism of any individual or department through a very professional way, said Saifullah Khan, President KCAA
To a query, President KCAA said that training sessions of Customs officials below 17-grade including Appraisers and Principal Appraisers should be conducted on regular basis, adding that they should also be trained through workshops and seminars. Responding to another question, Khan said that Customs Department should improve its working according to Customs Act 1969 and implement the said Act in letter and spirit. Answering to a question, President KCAA said that the present top brass of Customs Department is committed to improve the performance of the department and increase the revenue generation. Commenting on the Afghan Transit Trade (ATT) scam, Khan said that Pakistan Customs should conduct an impartial and unbiased inquiry in the light of the verdict given by Supreme Court of Pakistan (SCP). “According to the Public Orders 16/2000 and 5/2003, clearing agents are not answerable after handing over the goods to national carriers”, he added.
Replying to a question, President KCAA said that the authorities concerned in Customs should utilize all their resources in order to run WeBoc in effective manner, as clearing agents are still facing difficulties to file Goods Declarations (GDs) through this particular system and the prevailing situation compels them to file GDs manually. Saifullah Khan further said that Federal Board of Revenue (FBR) and Pakistan Customs should take into confidence the agents association and trade bodies before implementing or introducing any new system. President KCAA Saifullah Khan reiterated that Customs should take revolutionary steps in order to achieve the revenue target. In this regard, he suggested that all the related departments of Customs should cooperate with each other to increase the revenue generation. Khan hoped that the Karachi Customs Agents Alliance will continue struggle for safeguarding the rights of clearing/forwarding agents after coming into power again.
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PORTS&SHIPPING 11
SEPTEMBER 03 - SEPTEMBER 09, 2013
Committee for allowing export of vegetable ghee to KPK, Balochistan
ISLAMABAD: Senate Standing Committee on Commerce directed the Ministry of Commerce and Federal Board of Revenue (FBR) to allow export of 1,000 metric tonnes of vegetable ghee under Duty & Tax Remission for Exports (DTRE) scheme for the ghee manufacturers of Khyber Pakhtunkhwa (KPK) and Balochistan to promote and develop the industrial sector of these provinces.
KARACHI
Port Qasim to have
100,000 barrels Trans Asia oil refinery KARACHI
CuSTOMS TODAY REPORT www.customstoday.com
rans Asia Refinery Ltd (TRL), located at Port Qasim, has declared its“total commitment”to building the most complex refinery in Pakistan, producing more than 100,000 barrels a day and 4 million tonnes of petroleum products every year. In a major boost to the country’s economy, TRL signaled the end of previous delays with an undertaking that“the investors have decided to push the project forward in the interests of all parties and the people of Pakistan”. TRL’s determination to see the project through to completion is demonstrated by two important initiatives announced recently. First is the appointment of Descon to undertake a complete“health check”inspection of the TRL refining equipment. The second is a newlycompleted restructuring of TRL management to ensure the project proceeds with all possible haste. Sultan Al. Ghurair, the new CEO of TRL, said he was“delighted to have Descon on board in order to develop the project further”. Descon is the leading Engineering and Construction company of Pakistan.
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WHTonimportvalue increasesby27pc he increase of around 27 percent was observed in Withholding Tax (WHT) on import value in the last fiscal year 2012-13. The sources in the Customs House told Customs Today that the WHT on import value has been increased by Rs 7445m in the Fy2012-13 to reach Rs 35414m. They further said that the figure stood at Rs 27,969 million in the Fy2011-12 with 6.69percent rate of Customs Duty (CD). Increase in WHT in the Fy 2012-13 will definitely give an edge to Customs Department in current fiscal year. —CT Report
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CuSTOMS TODAY REPORT www.customstoday.com
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he shipping and communications experts have urged the government to start reforms at the ports as soon as possible in order to improve the country’s ranking in international ports. The experts, at a world conference and an exhibition of MultiModal Transportation and Logistics-INTERTRANS 2013 at a local hotel, urged the government to increase trade with other countries and reduce timings of container clearance at the all ports. The communications laws should be changed so that overcrowding at the ports and problems to the stakeholders could be avoided, they said. They informed the audience that according to World Bank, presently Pakistan ports stand at 71st place
Govt urged to reform
ports to improve ranking amongst 156 countries but this ranking could be improved by taking bold steps. The experts said that many suggestions and proposals had been sent to the govt to overcome the stakeholders’ problems regarding containers’ handling and clearing at the ports. Port Qasim Authority chairman Agha Jan Akhtar said that the government should improve logistics including coordination, communications and road networks before linking Gwadar Port with the Central Asian countries and turning it into a model port. He said coordination among stakeholders including Railways, National Logistics Corporation, National Highways, Customs and road transport operators should be
Govt should improve logistics including coordination, communications and road networks before linking Gwadar Port with the Central Asian countries and turning it into a model port, says Agha Jan Akhtar
improved through such conferences. The experts emphasised on improving supply chain, which is very important in transportation and international trade, along with ports & shipping and customs clearance problems at all the ports. They said that safe transportation of cargo was more important than timely movement of freight. National Centre for Maritime Policy Director General Vice Admiral (R) Asaf Humayun, International Chamber of Commerce Chairman Tariq M Rangoonwala, Sindh Revenue Board Commissioner Daud Pirzada and Civil Aviation Authority Airport Manager Afsar Malik also spoke on the occasion.
DP World handles 26.6m TEUs during first half of 2013
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KARACHI
CuSTOMS TODAY REPORT www.customstoday.com
eading marine terminal operator DP World Limited said that it handled 26.6 million TEU across its global portfolio in the first half of 2013, recording a drop of 5.8 percent as compared to the same period last year. “When adjusted for changes across the portfolio, the decline in throughput was 2.1 percent on a like for like basis. However, our global portfolio handled more containers in the second quarter than in the first quarter of 2013,” the world’s third biggest ports operator that controls 10 percent of the global terminal capacity, said in a statement.
“We remain confident about the long-term outlook of our industry and continue to invest to meet the future capacity requirements of our customers,” said DP World Chair-
man Sultan Ahmed bin Sulayem. He said the first half saw important progress in the delivery of three major projects in 2013. “In June we welcomed an additional 1
million TEU capacity at our flagship Jebel Ali Terminal. “This increased capacity is alleviating current constraints and will support future growth in the region. In the second half of this year, we will deliver developments in Santos and London Gateway.” Group Chief Executive Mohammed Sharaf said despite a softer first half DP World saw an encouraging uplift in containers handled during the second quarter. “This uplift, whilst positive, has occurred in challenging market conditions which we anticipate will continue into the second half. Accordingly, we remain focused on improving efficiencies, containing costs and handling higher margin containers to drive profitability,” said Sharaf.
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SEPTEMBER 03 - SEPTEMBER 09, 2013
uS customs officials seize $1.2m in counterfeit watches
LOS ANGELES: US Customs and Border Protection (CBP) officers seized $1.2 million in counterfeit Rolex, Louis Vuitton, Cartier, and Omega watches at Los Angeles International Airport. The 215 pieces, which had arrived from China via air cargo, would be worth $1.25 million if sold as genuine at suggested retail prices, the CBP said. The CBP officers discovered the counterfeit merchandise after inspecting the shipment manifested as “watches,” with a declared value of $173 and weighing 68 pounds.
ISLAMABAD
SM HAIDER
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hairman FBR Tariq Bajwa said that the government would bring 500,000 new taxpayers into the net in order to broaden narrowed tax base over the next five years. Talking to reporters at FBR’s headquarters, he said that FBR identified some major areas to identify potential taxpayers as they would bring 100,000 non-filers into the net during the current fiscal year. He said that FBR was also working on placing uniform evaluation system of different products of imports which would help implementing same policy at clearing points in the same manner as there were complaints that in case of placing effective mechanism at one entry point the importers were used to clear their imports from any
Govttobring 500,000 taxpayers into net: Bajwa other point. When asked about FBR’s powers for having access to bank accounts, the Chairman FBR said that there was no unusual activity reported by the State Bank of Pakistan (SBP) as he talked to him in start of August. “FBR has not so far accessed any bank account as it will only be used to unearth black money and in case of those who are non-filers,” he added. He said that the provision of access to bank accounts would not be utilized for existing taxpayers. FBR, he said, will devise proper rules related to access to bank accounts and only 14 to 15 tax officials in-
In order to achieve challenging target of
Rs 2475 billion in 2013-14, FBR starts sending notices to rich non-filers
cluding FBR Chairman and FBR Members will have permission to use this facility for identifying nontaxpayers. In order to achieve challenging target of Rs 2475 billion in 2013-14, the Chairman FBR said that they started sending notices to rich nonfilers who possessed assets in terms of holding precious lands in major urban centres & luxury vehicles, and those who are frequent international travelers and spending huge money on utility bills. “FBR has decided to utilize data of consumption and investment by focusing on getting information from relevant authorities regarding biggest transactions of urban lands, luxury vehicles, international travels and users of utility bills to broaden tax base,” he added. All those who made transaction of 500 square yards at the price of Rs 50 million will be brought into tax net, he added. Mr. Bajwa said that it would be a challenge to fetch additional revenues of Rs 535 billion in order to display the desired target set for the
PAS PROBATIONARY OFFICERS VISIT FBRHOuSE
FBR Chairman Tariq Bajwa in a group photo with Member FATE Ms. Riffat Shaheen, Member IR Policy Mr Shahid Hussain Asad, Member IR Operations Muhammad Ashraf Khan, Member Legal Safdar Hussain, Member Taxpayers Audit Haroon Muhammad Khan Tareen, Member Enforcement and WHT Aftab Anwar Baloch, Member Admin Shahid Hussain Jatoi and Pakistan Administrative Service (PAS) Probationary officers.
Published by M. F. Riaz for Customs Today and Printed at Dhoom Printing Press Masheer Mahal Building, Off: I. I. Chundrigar Road, Karachi
current fiscal year which would require a growth of 28 percent. The Chairman FBR said that there was less than 0.5 percent population discharging its national obligation as compared to developed countries. To a query regarding tax amnesty scheme, the Chairman FBR said that he was not in favour of any tax amnesty scheme. There would be zero tolerance on corruption among the FBR officers and Customs officers would also be suspended if found involved in any kind of corruption. On the issue of sales tax refunds, he said that FBR established a queue and repayments of refunds would be paid on first-come, first-served basis. He said that the Income Support Levy of 0.5 percent would be utilized for safety net programmes such as Benazir Income Support Programme (BISP). In order to discharge responsibility of Corporate Social Responsibility (CSR), he said that affluent people should voluntarily come forward to discharge their duty towards poor segment of the society.