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PAkISTAn’S FIRST IndePTh newSPAPeR On cuSTOMS

Vol 1 Issue no. 43

karachi, Tue dec 10 - Mon dec 16, 2013

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Regd. no, Mc-1381

Price Rs. 50.00

Reducing dollar to Rs98

The increasing price of dollar against rupee will be brought back to 98 rupees, says Finance Minister Ishaq Dar. | See PAGe 03 |

— Exclusive Customs Today photos

AddressingIMOsession

Kamran Michael becomes the first-ever minister who addressed this lofty forum for promotion of ports and shipping of Pakistan | See PAGe 02 |

FBR STRIVING TO

Taking back portfolio

BOOST TAX REVENUE –––MEMBER INTERNAL AUDIT KHAWAJA TANVEER–––

Prime Minister Nawaz Sharif has changed the portfolio of Minister of State Khurram Dastagir Khan by taking away the portfolio of Privatisation from him | See PAGe 04 | Attracting foreign investors

The Auditor General collects the data on daily basis, which is issued by FBR and then the collection is reconfirmed by the State Bank of Pakistan ISLAMABAD

FAIZA ISRAR

www.customstoday.com BR Member Internal Audit/Accounting Khawaja Tanveer Ahmed has said that Federal Board of Revenue is trying its best for generating more revenue through widening of the tax base and implementing some revolutionary policies to properly collect the taxes.

Describing Audit Wings responsibilities during an exclusive interview with Customs Today, Khawaja Tanveer Ahmed said that the role of this wing is to give a Minal shape to the revenue-related reports and to submit them to the Public Accounts Committee (PAC).

He said the wing deals with all matters

F The govt is implementing well-thought-out policies to boost trade relations with neighbours, says Pervaiz Malik | See PAGe 06 |

relating to PAC/DAC (Department Accounts Committee) on Audit Reports/Performance, Special Studies Reports and all matters relating to PAC/DAC on Appropriation Accounts (Grants with AGPR).

Explaining further details, Khawaja Tanveer said the wing also deals with all matters relating to DAC on management/MFDAC (Memorandum for Departmental Accounts Committee) reports and Financial Attest of Financial Statements (Revenue Components) for each Minancial year. The Audit Wing coordinates with Auditor General of Pakistan and Public Accounts Committee in matters relating to Audit, he added.

The Member explained that when FBR declares the

data of revenue collection of a Minancial year, the Auditor General veriMies this data with SBP and other sources. “If there is a difference in the data, the matter is discussed in DAC and referred to Accounting Wing and then we send it to the PAC in the Parliament,” he added. The Member Internal Audit/Accounting said that every month two meetings are convened to discuss all revenue-related matters. Meetings for considerations and scrutiny are called frequently after the promulgation of the Public Accounts Committee, he said, adding that it is a usual practice of every year. He said that the Auditor General collects the data on daily basis, which is issued

by FBR and then the collection is reconMirmed by the State Bank of Pakistan.

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PORTS&SHIPPING

DeCeMBeR 10 - DeCeMBeR 16, 2013

customs seizes goods worth Rs 11 million

LAHORE: Customs officials impounded valuable cloth of foreign origin, non-duty paid cigarettes and cigars worth Rs 11 million, official sources said. Sources said that four scouts of anti-smuggling collectively raided a bus at Shera Kot upon information received by Collector Junaid Akram and confiscated 50,000 metres of imported cloth weighing five tons and eight cartons containing non-duty paid cigars and cigarettes. A case has been registered against the responsible who tried to dump local market with such a heavy quantity of non-duty paid cloth, cigarettes and cigars.

375kg heroin seized from container at QICT he Anti Narcotics Force (ANF) has seized a container carrying record 375kg fine quality heroin at Qasim International Container Terminal, which was tactfully concealed inside the filters. The container, which was booked for Uganda, was loaded with 448 large size cartons (each carton containing 12 oil filters) and 1,113 small size cartons (each carton containing 40 filters). The five accused persons have been arrested after the preliminary investigations.

Meanwhile, ANF Peshawar Surveillance Team has also recovered 153kg heroin from a truck standing near Itifaq Market, Kohat Road. ANF Rawalpindi also carried out an operation at Attock and recovered 7kg charras from a house.

ANF Sea Port In-charge Sakhi Rehman, while talking to media, said that the ANF in recent days carried out about 30 raids against the drug traffickers and registered 55 cases and arrested 53 accused.

The ANF under ‘Ummeed-e Nau’ special operation confiscated 118.018 kilogram of heroine, 10,096.354 kilogram of hashish, 3437.19 kg of opium, 0.575 kg of cocaine, and above 1,751 tablets that were used in or as substitute of narcotics. —CT Report

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FBRtoestablishkiosks atairportstostop smugglingof foreigncurrency ederal Board of Revenue (FBR) is planning to establish kiosks at all the major airports of the country to verify the source of income of the travelers and to avert smuggling of foreign currency.

Sources said that Customs department had previously proposed to SBP to cut foreign currency cap from $10,000 to $3,000 along with imposition of ban on persons below 15 years of age to bring foreign currency with them and proposed to fix $1,000 limit for persons between ages 15-18 years.

A cap of $10,000 has been set by State Bank of Pakistan for the travelers, which was permissible only for taxpayers.

Sources added that following reports about some corrupt elements using families for transferring foreign currency abroad, FBR is developing apt measures to prevent flight of foreign currency.

They said that the staff at these kiosks would verify travelers if they are registered in the tax net or not. In case they are not taxpayers, foreign currency they hold will be taken into custody. —CT Report

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Security in Int’l waters a cause of concern for all countries: Micheal ISLAMABAD

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ederal Minister Kamran Micheal has said that security level in International Waters has been a cause of concern for all the countries which needs to be fully addressed, adding that sea trade and secure shipping is the most important thing.

He was addressing to 152 states in General Assembly of International Maritime Organization’s 28thsession being held in London.

Showing the contribution of Pakistan in maritime trade Federal Minister has said that Pakistan is having three functional ports namely Karachi ports, bin Qasim port and Gwadar port where size of maritime trade is increasing and Gwadar Port is going to connect the whole Asia together.

The minister said that Pakistan is playing a responsible role in environment control and safety of sea men at sea and regulation of SOLAS and MARPOL has been implemented in Pakistan. Elaborating the steps taken by Pakistan, Kamran said that he had established maritime control board to monitor the environment. He said that Pakistan is following London Convention regulations to promote shipping in Pakistan.

He said Netherlands has shown interest in developing Gwadar Mish harbour, adding that an agreement would be signed in this regard for

development of the sector. He highlighted the ongoing projects of his ministry including MoU to be signed with Sri Lanka. He said that PML-N government is taking effective steps for the promotion of trade. He said that traders would be provided a conducive environment to promote their business that would create vast job opportunities.

He also announced to upgrade the existing Marine Academy in Karachi into a full-Mledged university to provide world standard train-

ing to ofMicers and new entrants, besides attracting foreign students as well. The minister said that Mishing industry would be promoted to international level as there is great scope for its Mlourishment.

The minister said "we have various kinds of Mish which differ in taste and variety and it would bring revenue as well." Senator Kamran Micheal is Mirst-ever Pakistani Minister who addressed this lofty forum for promotion of ports and shipping of Pakistan.

GovtrequestsSCtodeclare891 appointmentsatPQAasillegal ISLAMABAD

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he federal government has requested the Supreme Court to declare all the appointments and promotions in the Port Qasim Authority (PQA) made from 2007 to 2013 as illegal.

HaMiz SA Rehman Advocate has submitted a written reply in the apex court on behalf of the Federation regarding appointments and promotions in the PQA from 2007 to 2013. The Federation stated in its reply that as many as 891 staff and ofMicers were either recruited or promoted illegally or unlawfully during the above mentioned period.

It also accepted that former Minister for Ports and Shipping Babar Ghauri had violated provincial and regional quota during the appointments. The reply stated that ac-

cording to instructions contained in the Estacode regarding appointments in BPS 20 and above in the statutory bodies, the competent authority is the prime minister.

Appointments in PQA in BPS 20 and above were not submitted for approval to the competent authority through Establishment Division as per instructions as well as PQA Service Regulations. Thus such appointments are also violative of rules.

It may be mentioned that during the previous hearing, the apex court had directed the Federation to submit reply regarding the appointments made during the tenure of previous government.

Meanwhile, the two-member bench, comprising Justice Ijaz Ahmed Chaudhry and Justice Sheikh Azmat Saeed, also heard a petition of PQA’s dysfunctional Secretary Abdul Jabbar Memon chal-

lenging his removal.

Deputy attorney general submitted government reply in pursuance of the court orders saying that a total of 85 persons were appointed illegally from grade17 to 21 in the Authority during the previous regime.

The reply further disclosed that all the 85 persons were appointed from mega city of Karachi whereas their educational qualification and experience was not up to the mark. Citing an example in its reply, the Federation told the court that experience certificate of an officer namely Nauman was sent to Ehsan Industries (pvt) Limited for verification which responded that no person with this name worked there.

The court asked the petitioner that he can submit reply in the matter and adjourned the hearing till December 19.

Pakistan is following London convention regulations to promote shipping in Pakistan

Japan shippers plan to order 90 new LnG tankers apan's top shippers plan to order around 90 new liquefied natural gas (LNG) tankers worth about 1.8 trillion yen ($17.61 billion) by 2020 as they gear up to transport rising volumes of the super chilled fuel from North America and Australia.

The expansion plans reflect rising LNG demand in nuclear-free Japan to generate electricity and also in other Asian countries such as China and South Korea.

Global LNG trading volume is expected to grow to 400 million tonnes (1.1023 ton) in 2020 from 250 million tonnes in 2012, according to industry data. Mitsui O.S.K. Lines Ltd., Japan's second-largest shipping company, plans to increase the number of its LNG carriers to 110 by 2020 from about 70 now, a spokesman said.

NipponYusen KK, the No.1 shipper in the country, plans to raise its LNG tanker strength to 100 by 2020 from about 70 now. —CT Report

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NATIONAL 03

DeCeMBeR 10 - DeCeMBeR 16, 2013

Gold import rises by 136.45pc

KARACHI: Pakistan's gold import has increased by 136.45 percent during July-October 2013 as compared to the same period of previous fiscal year, according to the data showed by the Pakistan bureau of statistics (PBS). PBS data revealed that gold import stood at $138.150 million during July-October 2013 as compared to $58.424 million during the corresponding period last year. In terms of quantity, the gold import has increased to 3,327 kilogram as compared to 1,080 kilograms during the period mentioned above, the PBS data indicates.

MCCAppraisement (West)recovers Rs32.299minNovember he Model Customs Collectorate (MCC) Appraisement (West) has recovered revenue of Rs32.299 million in November.The Post ReleaseVerification (PRV) Department of MCC-Appraisement (West), during audit of the month of November, has detected 35 cases of revenue loss owing to non-implementation onValuation Rulings in‘Green Channel’and recovered Rs32.299 million.

MCC-Appraisement (West) Collector Muhammad Saleem, while talking to CustomsToday, confirmed that the PRV Department has detected 35 cases of revenue loss in‘Green Channel’in which the Valuation Rulings were not implemented. He further said that the PRV Department has recovered the lapsed amount by raising demands with the importers through legal notices.“The entire process of recovery was difficult, but it could be possible with hardworking of the officials of MCC-Appraisement (West),” he added.

Collector Muhammad Saleem expressing his satisfaction on revenue recovery said that the process of revenue collection is becoming better day-by-day. —CT Report

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Banks bound to submit monthly account holders’ deposits statement to FBR very bank will have to submit to FBR a monthly Account Holders Deposits Statement of persons depositing Rs 1 million or above in a month.

FBR has issued SRO.1035(I)/2013 to propose amendments to the IncomeTax Rules, 2002 for issuance of the ''banking companies reporting requirements''.

The draft will be taken into consideration by FBR after seven days of its publication in the official gazette. Any objection or suggestion, which may be received from any person, in respect of the said draft before the expiry of the aforesaid period, shall be considered by FBR. As per draft rules, the information may not be provided by the banking company officer in respect of a person who holds National Tax Number and has also filed return of income for the immediately preceding tax year. FBR has also proposed that the banks shall provide information under section 165A of the IncomeTax Ordinance through Account Holders Deposits Statement, Credit Card Payments Statement,Written-Off Loans Statement, currency transactions report and suspicious transactions report. —CT Report

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dar vows to bring down dollar rate to Rs98 The govt is taking concrete measures to cover the shortfall and achieve the target.These steps include broadening of tax base, rationalisation of SROs and addressing inadmissible input adjustment and illegal refunds in sales tax ISLAMABAD

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ederal Minister for Finance Ishaq Dar has said that the increasing price of dollar against rupee will be brought back to 98 rupees.

He said that the industrial expansion and investment is the need of hour. He said the income support levy has now become part of the budget and this is not a tax as it will be spent on the poor.

The Federal Minister said that the Income Tax Ordinance 2001 empowers the government to give legal cover to its efforts for expanding the tax net. He further said that the income support levy had become part of the Minance bill. Senator Ishaq Dar also chaired a meeting of the Economic Coordination Committee (ECC) of the Cabinet at the Prime Minister’s OfMice.

The ECC approved the lease of five A320 aircrafts from the ten A319/320 aircrafts shortlisted on merit based on their combined score tabulated on their financial and technical parameters. The remaining five aircrafts were rejected because of their low combined score.

The ECC approved the dry lease of Mive A320 aircrafts with the direction that the lease period of the present aircrafts hired on wet lease may be extended so that a pool of at least ten aircrafts be maintained for convenience of general public and passengers. The ECC also authorised PIA to initiate bidding for tender of additional Mive aircrafts which may be inducted by June 15, 2014. The Finance

Minister observed that the Minalization of this lease by Pakistan International Airlines will not only rehabilitate its international credibility but also improve its image. The ECC approved providing guarantees to Exim Bank of USA and Islamic Corporation of Insurance and Export Credit (ICIEC) for providing Minancing for servicing and repairs of nine bowing 777 aircrafts which are the main stay of PIAC Mleet subject to approval of Minancing terms by the Finance Division.

The meeting was attended by Minister of Food and National Security Sikandar Bosan, Minister for Petroleum and Natural Resources Shahid Khaqan Abbasi, Minister for Information and Broadcasting Senator Pervez Rashid,

Minister for Science and Technology Zahid Hamid, Minister of State for Information Technology Anusha Rehman, Board of Investment Chairman Zubair Umar and senior ofMicials of the Ministries of Finance, Water and Power, Planning and Development, Commerce, Communications and Industries.

Meanwhile, Federal Minister for Finance Senator Ishaq Dar has said that the decline in tax base and dutiable imports are disturbing the revenue collection in general. He told the Upper House while replying to Senator Saleem Mandviwalla’s question regarding shortfall in revenue collection during the current Miscal year.

The federal minister informed the House that revenue collection target for 2013-14 was based on the supposition and just Rs1,946 billion could be collected by the end of June 2013 against the target of Rs2,007 billion. The country has to bear Rs35 billion revenue shortfall from July to November this year as about Rs807b revenue could be collected in Mirst Mive month of the current Miscal year against the target of Rs842b projected for the same period. But FBR, in terms of comparison with the previous year’s collection, has witnessed a growth of 17.63 per cent in the said period as Rs686b were collected during the same period last year. The authorities have projected a revenue collection target of Rs2475b for the year 2013-14.

Senator Ishaq Dar said that the government is taking concrete measures to cover the shortfall and achieve the target, adding that these steps include broadening of tax base, rationalisation of SROs and addressing inadmissible input adjustment and illegal refunds in sales tax.

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04 NATIONAL

DeCeMBeR 10 - DeCeMBeR 16, 2013

Business community says no to shifting of TdAP hQs

KARACHI: Karachi Chamber of Commerce and Industry (KCCI) and the entire business community of the city have strongly opposed any attempt to move the headquarters of Trade Development Authority of Pakistan (TDAP) from Karachi to Islamabad. In a statement, the KCCI president has expressed deep concerns over reports of shifting TDAP headquarters from Karachi to Islamabad. KCCI President Abdullah Zaki has said, “It is highly unfair to deprive Karachi city of the services being offered by TDAP headquarter.

High Court issues notices to President, FBR

dastgirgivenportfolioofcommerceMinister

ahore High Court (LHC) has issued notices to Federal Board of Revenue and the President of Pakistan, who have ignored the FTO’s order, in which FBR was directed to take immediate steps to stop anomalies in income tax slabs for salaried class under Finance Act, 2012.

As per the order, the FTO has proposed revision in the tax slabs number 4, 5 and 6 to give major tax relief to salaried persons falling within these categories. Source said that Law and Justice Division has issued an order in which the President has accepted the representation of FBR under section 32 of the FTO Ordinance, 2000 in C No SUO MOTO (1)1100/2012 (Waheed Shahzad ButtVs Secretary Revenue Division, Islamabad). A petitioner,Waheed Shahzad Butt, under Article 199 of the Constitution of Pakistan has challenged the president’s order before the LHC. The petitioner pointed out that though the salaried taxpayers have been provided tax relief but this benefit would be gradually decreased with the increase in salary under the new slab structure for the salaried class as per Finance Act 2012.

However, in the last three slabs where the fixed component does not tally with the maximum tax factor of earlier slab, it was an error of commission at the part of FBR, which was thrown away by the FTO under Own Motion action. —CT Report

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he Directorate General of Customs Valuation has issued two more Valuation Rulings No. 613/2013 and 614/2013 of home inverters without battery and betel nuts under section 25-A of the Customs Act, 1969.

The Customs value (C&F) of the home inverters without battery less than 1KV of Chinese origin having PCT heading 8504.4090 and proposed PCT for WeBOC is 8504.4090.1000 has determined at $13 per piece, while the Customs value of 1 KV home inverters having PCT heading 8504.4090 and proposed PCT forWeBOC is 8504.4090.1100 has determined at $25 per piece. Likewise, the Customs value of Betel nuts, Indonesia/Malaysia origin having PCT Code 0802.8000 and proposed PCT forWeBOC is 0802.8000.1000 has fixed at $0.85 per Kg while the Customs value of betel nuts ofThailand origin having PCT Code 0802.8000 and proposed PCT for WeBOC is 0802.8000.1100 has fixed at $1.10 per Kg.The values determined vide this Ruling will be the applicable Customs value for the assessment of subject imported goods until and unless it is rescinded or revised by the competent authority in terms of SubSection (1) or (3) of Section 25-A of the Customs Act, 1969. —CT Report

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FBR collects Rs806b in July-nov against target of Rs841b ISLAMABAD

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ederal Board of Revenue has collected Rs806 billion during the period between July to November 2013-14 against the target of Rs 841 billion, showing a shortfall of Rs35 billion.

According to sources, FBR has collected Rs120 billion more revenue as its provisional collection has crossed Rs806 billion during Mirst Mive months of the current tax year against Rs686 billion during the corresponding period of last Miscal year, reMlecting growth of 21 per cent. FBR requires a growth of almost 28 per cent in the current Miscal year in order to achieve the desired tax collection target of Rs2,475 billion against a collection of just Rs1,936 billion in last Minancial year.

FBR achieved the monthly target in November 2013 and collected Rs169.333 billion against target of Rs167 billion with a growth of Rs2.333 billion. The provisional collection in November 2013 was Rs169.333 billion against Rs139.708

— Exclusive Customs Today photo

ValuationRulingsof homeinverters, betelnutsissued

billion during the same period of previous Miscal, reMlecting a growth of 21 per cent. Tax wise detail shows that income tax collection stood at Rs57.326 billion, Sales Tax Rs84.789 billion, Federal Excise Duty Rs13.142 billion and Customs Duty Rs18.842 billion. Total gross revenue collection stood at Rs174.099 billion during this period. After payment of refund to the tune of Rs4.766 billion. So far, FBR has received as many as 154,756 income tax returns through electronic system. This amount would be further improved by the extension in date of Miling of tax returns. Meanwhile, FBR Spokesman Shahid Hussain Asad claimed that as many as 22,000 companies would deposit tax returns annually.

He said that after the announcement of Prime Minister’s package, thousands of new taxpayers would come into the tax net and the Minance minister would issue four SROs for the implementation of this package during the current week. Shahid also claimed that FBR would not only achieve the six monthly revenue target of Rs1,090 billion by December 31 but also cross tax recoveries of Rs1,100 billion.

ISLAMABAd: Prime Minister Nawaz Sharif has changed the portfolio of Minister of State Khurram Dastagir Khan by taking away the portfolio of Privatisation from him. According to a notification, Dastagir has been appointed Minister of State for Commerce andTextiles.The portfolio of Privatisation is now vacant. In addition to his current portfolio, Dastagir also heads the National Assembly’s Standing Committee on Commerce.

FBR urged to address SRO issue he Pakistan Automotive Manufacturers Association (PAMA) has urged Federal Board of Revenue (FBR) to resolve the issue of SRO released in the light of economic Coordination Committee’s (eCC) decision, which if not amended, will have severe consequences for consumers and industry as well.The DG-PAMA, in a letter to the FBR chairman, said motorcycle industry cannot afford any cost increases as it is already working on very thin margins.The anomaly in question will have severe impact on prices of poor man’s vehicle, which under foreign exchange and other inputs pressure is already on the rise, he said. DG-PAMA AbdulWaheed has asked Tariq Bajwa to look into a matter requiring his urgent intervention as the consignments are held up at the port on accounts that increased rate of duty is being called upon to be paid as the subject SRO has lapsed on November 30th 2013. —CT Report

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NATIONAL

DeCeMBeR 10 - DeCeMBeR 16, 2013

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no FBR access to taxpayers’ bank accounts

KARACHI: The government has guaranteed the business community that FBR will not have access to the bank accounts of regular taxpayers, an official has said. Federation of Pakistan Chambers of Commerce and Industry (FPCCI) President Zubair Ahmed Malik has confirmed that the prime minister had earlier agreed to give relaxation of bank account access by FBR in the cases of regular taxpayers. “Otherwise, the non-taxpayers will be given opportunity to file their tax returns before accessing their accounts,” he added.

Importers hold terminal operators responsible for containers backlog

Not a single container on hold owing to Customs Department: Saleem

— Exclusive Customs Today photo

KARACHI

BR DG I&I Riaz Khan has uncovered massive theft of petroleum products while being supplied to Isaf and Nato forces in Afghanistan. According to official sources, the directorate has reported that several companies and contractors are transporting duty-free POL products to Afghanistan, but the supply is decanted before reaching the destination, which is causing huge revenue losses to the national exchequer. As per Customs laws, the pilferage of goods is tantamount to smuggling, the officials said. The DG I&I has urged the Customs collectorates to provide reconciliation reports for verification of documentations.The directorate also asked the Defence Attaché, British High Commission, Islamabad and representatives of Defence Logistic Agency-energy (DLAe), US embassy in Kabul to give details of the quantities ordered by them.The supply contracts of Isaf, Nato and DLA-e and several oil marketing companies were also directed to provide the relevant details. —CT Report

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SOhAIL RAB khAn www.customstoday.com

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he importers hold Ministry of Ports & Shipping and terminal operators responsible for backlogging of containers at Karachi International Containers Terminal (KICT) and Pakistan International Containers Terminal (PICT).

Sources told Customs Today that around 2,208 containers are laying unattended at the KICT and around 1,900 containers at the PICT, as the terminal operators demanding demurrage on cargo stuck during 12-day transporters’ strike from the importers.

Whereas, Ministry of Ports and Shipping vide letter No. 1 (102013-Secy P&R) dated November 20, has announced waiving of demurrage on the cargo stuck during the transporters’ strike from Nov 7 to Nov 18.

On the other hand, the terminal authorities are of the view that they have not yet received any notification regarding waiving of the demurrage. “Non-implementation on the notification is a major issue of the accumulation of the containers at the KICT and PICT”, importers added.

When contacted, Collector MCCAppraisement (West) Muhammad Saleem said that the lack of space at the terminals is a major cause of backlog of containers, adding that the terminal operators also have

to accumulate the containers in the examination area allotted to Pakistan Customs at both the terminals. “I check the report of pending work on daily basis”, the Collector said.

To a query, Muhammad Saleem said that the each appraiser has to handle 15 to 25 Goods Declarations a day. However, the Customs officials have to work for hours due to shortage of manpower, he added.

Collector Muhammad Saleem claimed that not a single container is on hold owing to hardworking Customs officials at KICT. “The terminal operators have limited space and off-loading of Afghan Transit Trade (ATT) cargo due to stoppage of Nato supply is further aggravating the situation at terminals”, Collector said, adding that around 200 containers are examined and assessed on daily basis.

The Collector MCC-Appraisement (West) further said that the terminal operators already have more workload than their capacity. The Karachi Port Trust (KPT) should provide extra space to the terminal operators, he demanded.

Meanwhile, Faisal Mushtaq, General Secretary, Karachi Customs Agents Association stated that since the announcement of Waiver of Demurrage charges by the Ministry of Ports & Shipping

on account of the strike called by transporters, no proper communication to private terminal operators i.e. PICT, KICT & QICT has been made and not a single waiver has been allowed.

A delegation of KCAA met with Chief Executive, PICT, Capt. Zafar Awan and PICT allowed waiver of 15% demurrage for the deliveries which are made prior to 9th Dec, 2013.

In view of the above situation, Faisal Mushtaq requested the members to take out their deliveries and take advantage of this waiver. He further reiterated that the waiver of demurrage made by the Ministry of Ports & Shipping should be implemented in its true spirit.

— Exclusive Customs Today photo

Hugepilferagein NatosupplyofPOL productsuncovered

Govt all set to reduce expenses of foreign missions by Rs3.5b ISLAMABAD

cuSTOMS TOdAY RePORT www.customstoday.com

he government is all set to reduce expenditures on foreign missions abroad by Rs 3 to Rs 3.5 billion per annum.The decision to this effect was taken during the meeting of the Committee to Review the Performance of Pakistani Missions abroad here onWednesday which met under the chairmanship of Senator Mohammad Ishaq Dar. The Committee deliberated on the recommendations made by the Sub-Committee constituted for the purpose and headed by Special Assistant of Prime Minister Mr.Tariq Fatmi and assisted by Special Assistant to Prime Minister Khawaja Zaheer, Secretaries of Cabinet and Finance.The SubCommittee was directed to consult those ministries whose officers were posted in various Pakistani Missions abroad before finalizing its recommendations.

It may be recalled that Prime Minister Nawaz Sharif had constituted a Special Committee under the chairmanship of Finance Minister Senator Ishaq Dar to review the performance of officers posted in Pakistani Missions abroad with a view to

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cut expenditures as part of the austerity drive of the present government without effecting the efficiency and national interest of Pakistan.

The Finance Minister in his remarks appreciated the work of the committee and recommendations made by it to right size Pakistani Missions. As a result of the recommendations of the committee it is estimated that the expenditure on foreign mission would be reduced by Rs.3-3.5 billion annually.The Finance Minister said that the present government was pursuing a policy of austerity and had taken various measures including abolishing of secret funds of 34 departments as well as the discretionary funds of the Prime Minister and Federal Minister besides slashing in non-salary expenditure by 30% and

rationalizing fees of government servants nominated on the Board of Directors of Public Sector enterprises.

The Finance Minister also informed the members of the Committee that the government would soon start a process to streamline the expenditures made by various Divisions, attached departments, autonomies bodies etc. so

that unnecessary non-development expenditures can be checked and saving thus made were utilized for the development of the country.

After in-depth deliberations on various options, the committee under the chairmanship of the Finance Minister Ishaq Dar approved the recommendations of the SubCommittee with changes and expressed the hope that its implementation would be completed within 60 days from the date of approval by the Prime Minister of Pakistan.

The Committee also directed the Ministry of Foreign Affairs and concerned Ministries to submit the performance report of incumbent offices presently working on various positions in Pakistan Missions for consideration of the committee within the next 30 days. The Finance Minister said that the Sub-Committee led by Senator Tariq Fatemi would be converted into an Implementation Committee which would over look the implementation of the recommendations of the Committee.

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SPeCIALRePORT

DeCeMBeR 10 - DeCeMBeR 16, 2013

In spite of all major issues, increasing trade ties with India can be called one of the best examples of the government’s revolutionary policies. That is why India is also interested in improving trade ties with Pakistan

PROFILE Mohammad Pervaiz Malik was born in Lahore on November 18, 1947.

He is elected to the National Assembly for the second time on the PMLN seat. He was previously elected as MNA for the term of 1997-1999. Mohammad Pervaiz Malik is also a member of the Parliamentary Task Force on WTO issues.

An industrialist by profession, Mohammad Pervaiz Malik completed his B.Sc Engineering from Aston University, UK in 1970, and is a member of the Lahore Gymkhana Club and the Lahore Businessmen Association for the Disabled. He has travelled extensively through numerous regions of the world. He has previously served as a member on the Standing Committee of the National Assembly on Labour and Manpower.He is a member of National Assembly’s following committees: Standing Committee on Commerce, Standing Committee on Finance and Revenue and Standing Committee on Minorities.

LAHORe

MIAn ShAFQAT SAeed www.customstoday.com

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ML (N) Lahore President and MNA Pervaiz Malik has said that the PML-N government always introduced traders-friendly policies after coming into power to promote business activities in the country. In the same way, traders also come forward and fully cooperate with the government for development and progress of the country.

In an exclusive interview with Customs Today, Pervaiz Malik, member of National Assembly’s Standing Committees on Commerce & Finance and Revenue, said that the government is striving hard and implementing well-thought-out policies to establish and boost new and already existing trade relations with its neighbours including Iran.

“In spite of all major issues, increasing trade ties with India can be

called one of the best examples of the government’s revolutionary policies. That is why India is also interested in improving trade ties with Pakistan,” he said. The government has set clear agenda of implementing only those policies to enhance export-related connections and discourage foreign aid and loans from the US and other donors.

“For this purpose, we are also taking part in all trade exhibitions being held in other countries along with introducing and promoting their products in Pakistan as well in coordination with chambers of commerce and industry,” he added.

Pervaiz Malik said that the government is promoting Pakistan’s good image in other countries through its Minancial ambassadors as this will ultimately result in attracting more and more foreign investors. In addition, improved security situation in the country would also bring in foreign investors, he said, adding, “It would also make it easier for us to get access to foreign markets.” He urged the industrialists to improve standard and quality of their products to increase exports because high quality products can be the simplest way to lure the investors.

Talking about Pak-Iran business

train, Malik said that it would deMinitely multiply trade between the two countries. Similarly, the government has strengthened relations with Turkey that is why Turkish businessmen are investing in Pakistan at a large scale.

He stated that gas and electricity crises and law & order situation took the economy to the brink of collapse, owing to which foreign investors felt insecure to invest their money in the country. It is the top priority of the government to fade out these crises and the government is working on it day and night.

He said that the government is making a comprehensive plan to build dams at the earliest to resolve these issues in the best interest of the country. Problem of gas loadshedding would be resolved within few years and Pak-Iran gas pipeline project would also be implemented in this regard.

He said that the government has taken stern action against extortionists to get rid of this menace from the

country. Such criminal elements are being nabbed and brought to justice.

He said, “I always played role of a bridge between the government and traders and remained active to resolve their problems”.

He appealed to the traders that they should convince the people to pay taxes so that the country could get out of rid of the clutches of foreign donors.

Commenting on decreasing value of rupee, he said that Minancial crunch was the main reason behind this crisis. He blamed that the former governments made artiMicial policies and left behind several major problems for the current government.

But the current government is working on a feasible and solid economic plan, he asserted.

Commenting on Customs Today, Pervaiz Malik said that the newspaper seems to be the true representative of traders across Pakistan. He congratulated Customs Today team for their hard work.

DeCeMBeR 10 - DeCeMBeR 16, 2013

SPeCIALRePORT 07

— Exclusive Customs Today photos

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08 eDITORIAL

DeCeMBeR 10 - DeCeMBeR 16, 2013

Founder & Chairman Zulfiqar Ali editor nasim Ahmed executive editor Rahil Yasin 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

The case of missing containers

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he story of containers vanishing from the Karachi port never seems to end. While the mystery of 19,000 containers has yet to be solved in the midst of allegations and counterallegations hurled against each other by various government agencies involved, the case of another 31 missing containers has hit the headlines.

Last week, Port Qasim Authority officials told the Senate Committee on Ports and Shipping that the 31 containers were other than the '19,000 containers' lost in the past.

Speaking on behalf of the Customs Department, Member Customs Nisar Muhammad Khan told the Senate Committee that Custom Intelligence had detected 31 containers which disappeared from Port Qasim, while the customs and bank documents on which the containers were 'released' were found to be fake. Clarifying the position of the PQA, its chairman Agha Jan Akhtar told the Committee that the port authorities’role ends after unloading and handling containers. He said that shifting and delivery of containers from DP World/QICT to freight stations (customs bonded area) is carried out under the supervision of customs authorities. Hence, PQA is not responsible for transfer and delivery of containers.

The Committee members rightly expressed their concern over the issue and directed the authorities concerned to exercise greater vigilance to track the movement of containers.

In a welcome move the customs authorities have acted with alacrity to fix responsibility in the matter. According to the latest information, 14 customs officials have been suspended while a high-level committee headed by a Grade-21 officer has been constituted to hold further probe into the case. A sum of Rs110 million has also been recovered from the officials on the basis of declarations related to these containers.

Although, according to the declaration, the 31 containers were carrying auto parts, it has not yet been authoritatively established what their actual contents were. A full investigation is, therefore, called for to ascertain not only the identity of their owners and but also their actual contents. Given the fact that the country is in the grip of terrorism, apprehensions have been expressed that the stolen containers might be carrying arms and other illicit goods.

The case is illustrative of the lax control exercised by the Karachi port authorities over the movement of goods containers. As the KPT officials themselves admitted at the Senate Committee hearing, there are 2,081 vehicles and 1,450 containers standing at the port for the last several years. The question is: what prevented the port and customs authorities from tracing their owners and opening them under the supervision of higher authorities?

Clearly, the entire system is rickety and porous and calls for radical overhaul.

Tax incentive package

A step in right direction ISLAMABAD

SM hAIdeR

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T

he tax incentive package announced by Prime Minister Nawaz Sharif is a good step in the right direction but it requires in-depth analysis whether it will provide any beneMit to kickstart economic activities or will prove to be another eye wash for sharing beneMits to just few business cronies of the incumbent regime.

If one analyzed historical prospective of giving tax incentives by allowing money whitening schemes or amnesty schemes in last two decades, none of them had been able to lure investors in a big way.

What was the missing link in it?

The answer is crystal clear that the government requires a policy of carrot and stick to get attention of potential tax evaders. If government’s policy is only relying upon

carrot then it will not deliver positive results while if it only relies on stick then it will again prove wrong.

It is yet to see how much the government shows its ability to attract investment through this scheme where source of income will not be questioned.

quirement such as energy and water sectors at the moment.

The PML (N) government wishes to divert investment towards productive industrial sector of the economy. They argue that tax exemptions were enjoying by the stock market and if they provided same incentives to in-

By providing incentives to non-filers for coming into tax net, the government will have to make its enforcement an effective tool to penalize those who will not avail even these tax incentives.

By excluding certain sectors such as sugar, cement, textile and others which have already touched a saturation point is also welcoming this step as it shows the intent of the government to attract investment in those areas where the country possessed a pressing re-

dustrial sector then there should be no criticism over it.

According to the government arguments, there is no other solution to kick-start economic activities so this package will play a pivotal role for achieving the desired results.

By providing incentives to nonMilers for coming into tax net, the government will have to make its enforcement an effective tool to penalize those who will not avail even these tax incentives.

The withdrawal of access to bank accounts for NTN holders and income tax Milers is a welcome step because it aimed at broadening of tax base without compromising its documentation exercise.

The element of harassment to existing taxpayers on the part of FBR is a known phenomenon and by providing access to bank accounts there is a growing fear that chances of exploitation of this provision would be multiplied manifolds.

Now FBR will be going to withdraw this provision of law on access to bank accounts by next week by issuing a formal notiMication on this subject. So far draft notiMication has been released by FBR for seeking suggestions from the stakeholders in seven days.

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PICTORIAL

DeCeMBeR 10 - DeCeMBeR 16, 2013

MccI asks govt to give 10-year tax relief to South Punjab

MULTAN: Multan Chamber of Commerce & Industry (MCCI) has demanded the government to declare South Punjab as tax-free zone for 10 years to attract investors and other incentives. The entire business community of region has also lauded the measures and package announced by PM Nawaz Sharif for economic revival. MCCI President Khawaja M Usman said that due representation be given to South Punjab in the PM Business Advisory Council and hoped that comprehensive reforms package would surely encourage business and investment opportunities in the country.

— Exclusive Customs Today photos

OATh TAkInG ceReMOnY OF FBR cBA

ISLAMABAd: Oath taking ceremony of newly-elected Federal Revenue Alliance employees (Regd) CBA Model Customs Collectorate Islamabad held under chairmanship of Imtiaz Ahmed Khan (Collector Customs).

— Exclusive Customs Today photos

ISLAMABAd: President Federal Revenue Alliance employees (Regd) CBA Model Customs Collectorate Islamabad Imtiaz Ahmed Khan (Collector Customs) cutting the cake on occasion of oath taking of newly elected Federal Revenue Alliance employees union at Customs House.

ISLAMABAd: Saeed Ahmed Khan Chairman Oil and Gas Regulatry Athorty (OGRA) talking at Policy Symposium on "Taxation and energy Reforms in Pakistan".

kARAchI: A group photograph of Abdul Baqi Khan M.D. Merck, Mehmood Parykh, Arshd Aleem, Consul and Deputy Head of the Mission Hans Juergen Peschke and others during the launching of 2014 Calendar of Merck.

ISLAMABAd: Ahsan Iqbal talking at a conference organized

by UNDP on ‘Alternative Media in Pakistan’.

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10 NATIONAL

DeCeMBeR 10 - DeCeMBeR 16, 2013

Arms smuggling bid foiled near Peshawar

PESHAWAR: The law enforcement agencies have foiled a bid of arms smuggling in the outskirts of the provincial capital and arrested the accused person. As per details, the police on a tipoff that huge cache of arms and ammunitions would be smuggled out from tribal areas to the country, intercepted a truck near Mathani. Ten pistols, 11,840 rounds, one rifle and eight repeaters were seized during a search of its secret cavities. Accused driver Akhtar Khan resident of Tela Banda Peshawar have been arrested.

weBOc modifications

FBRformsteamstoaudit concessionaryimports underdifferentpacts

T

Customs seizes 7,000 litres of smuggled Iranian diesel alochistan Directorate of Intelligence & Investigation (DI&I) have seized 7,000 litres of smuggled Iranian diesel from Zero Point area. DI&I Director Iqbal Bhawana, on a tip-off, deployed an anti-smuggling team at Zero Point area that intercepted two buses and recovered 7,000 litres of diesel.

The department, after registering a case against the accused person, has started investigation. It is worth mentioning that the Directorate has so far recovered over 15,500 litres of diesel during last three months. —CT Report

B

wRITe TO uS YOuR GRIeVAnceS: Through cuSTOMS TOdAY platform heLP deSk, now you have chance to dIRecTLY write your problems to top govt. functionaries.

If you have any grievances, queries, questions or suggestions, you can write in this section as it provides easiest access to you to approach Customs and Revenue authorities. whO can write in this section?

Importers & exporters, Customs Agents, Chambers of Commerce, Trade Associations and Customs Officers TO whOM you can write?

Honourable PM, Minister/Secretary for Finance & Revenue, Minister/Secretary for Ports and Shipping, FBR Chairman, Member Customs and Chairperson Senate/National Assembly Standing Committee on Finance & Revenue.

Send your letters at: letters@customstoday.com.pk

The off-dock terminals are working on their own without following the directives of authorities concerned, similarly there is no regulatory body for shipping KARACHI

SOhAIL RAB khAn www.customstoday.com

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akistan Customs and Reforms & Automation Directorate should take stakeholders into conMidence before modifying the automated system, WeBOC. Karachi Customs Agents Association (KCAA) General Secretary Faisal Mushtaq said this while talking to Customs Today during an exclusive interview at his ofMice.

Commenting on the recent scenario, the KCAA General Secretary said that the cost of doing business should be decreased, so that the common man could be facilitated directly. He demanded the government to look into the matter and take some effective steps in order to facilitate the importers and business community.

Replying to a question, Faisal Mushtaq said that nowadays, the terminal operators have become the direct beneMiciary from the current system.

“The off-dock terminals are working on their own without following the directives of authorities concerned, similarly there is no regulatory body for shipping,” he said, demanding that the Ministry of Ports & Shipping should take immediate step in this regard. He further demanded that the number of free days at the terminals should be counted from the day, the container is grounded.

On the other hand, the off-dock terminals are in at liberty to charge whatever they want to; like, WeBOC has been rolled out to all the off-dock terminals and Air Freight Unit (AFU), but in absence of EDI

— Exclusive Customs Today photo

he Directorate of Internal Audit (Customs) of FBR has formed four teams to audit concessionary imports cleared by the Karachi Customs collectorates during 2012-13 under various trade agreements to determine revenue losses to the national exchequer.

Assistant Director Muhammad Rizwan, Assistant Director Abdul Majeed, Deputy Director Omar Shafique and Deputy Director Baleeghur Rehman to conduct the audit of Model Customs Collectorate (MCC) AppraisementWest, MCC Appraisement (east), MCC Port Muhammad Bin Qasim and MCC Preventive, respectively.

According to sources, the step to audit the concessionary imports was taken after a report prepared by the Customs authorities last year, in which it was pointed out that concessions provided through different SROs, including for the preferential trade agreements (PTAs) and free trade agreements (FTAs) had causing loss of billions of rupees to the national exchequer. In addition, the relief granted by the government have also been misused through under-invoicing or misdeclaration, they said.

An FBR report revealed that Pakistan had made arrangements with some countries which cost the country about Rs 14 billion during 2010-11.The exemptions and concessions provided to them constitute around 15% of the total cost of exemption of customs.The study concluded that a huge cost of exemption through SROs including FTAs/PTAs requires review of the situation. A huge amount of around Rs95 billion has been estimated as cost of exemptions for 2010-11 on account of customs duty which does not include the impact of zero rating for 400 items, it said. —CT Report

KCAAGenSecyurgesCustomsDepttotake allstakeholdersintoconfidence

The number of free days at the terminals should be counted from the day, the container is grounded, says KCAA Gen Secy Faisal Mushtaq

the rolling out is merely a data entry and service providers have to run from pillar to post at the time of delivery, Mushtaq said.

He further added that KCAA has approached the Project Director in this regard, and the director has also issued a letter in this context that the screens have been provided to off-dock terminals as well as preventive staff, and payments/deliveries should be made according to the message available on the WeBOC screen provided to them.

But so far, no administrative orders have been issued by the authorities concerned and every month a new date is given by offdock terminals/AFU GHA'S, he said.

He insisted that the relevant authorities should take strict action and penalise the terminals who are delaying the EDI development.

Mushtaq further demanded that Pakistan Customs should ensure the early release of EDI message, so that the Customs agents get convenience in clearing process.

He urged the Customs authorities to bring positive and contemporary changes in WeBOC for the facilitation of the importers, Customs agents and other stakeholders.

Replying a question about long queues on banks for duty payments, he stated that this is the strong demand of KCAA to increase the number of branches to facilitate the traders.

He added that since taking over the charge, he has been pursuing this matter and the higher management of NBP, Humayoun Zafar from PRAL, and Additional Collector MCC Appraisement-West Iqbal Muneeb have also taken up this matter very seriously.

Soon four branches of NBP would be made available for payment of duty and taxes using WeBoc, he hoped.

delay in goods clearance at AFu disturbing importers To, The Chairman Federal Board of Revenue, Islamabad Respected Sir,

Importers are suffering from deep mental agony at Air Freight Unit (AFU) due to the delay in the clearance of their Goods Declarations (GDs).

Customs officials are hardly clearing 3 to 4 GDs per day and importers are compelled to pay demurrage and detention charges on their goods due to delay.

Importers and other stakeholders are appealing to the high officials of Federal Board of Revenue to take notice of the prevailing situation at AFU as delay in clearance of GDs is increasing the woes of Customs agents, importers and other stakeholders.

Despite clear orders issued by FBR, officials are charging high prices on imported goods. The business cost has been increased with the elimination of freight memo.

AFU is also facing shortage of staff, as only eight appraisers are there to handle tonnes of cargo.

The terminal operators are also charging high godown rates from importers in case of delay.

WeBOC System is not bad, but delay of 4 to 5 days in clearance of goods is affecting cost of imported goods. We request you to take immediate action in this regard so that process of goods clearance at AFU could be accelerated.

Thanks & Obliged, Yours Sincerely, Athar Baig, Proprietor, Impex Enterprises

www.customstoday.com DeCeMBeR 10 - DeCeMBeR 16, 2013

APdA chairman concerned over clearing agents strike

CARTOONSSPeCIAL

SIALKOT: All Pakistan Dry Ports Association (APDPA) Chairman Mohammad Ishaq Butt expressed deep concern over the situation that emerged after the strike by the clearing agents and freight forwarders at Sialkot Dry Port. Earlier, clearing agents and freight forwarders went on strike after the arrests of clearing agents and related staff. Despite unpleasant circumstances, the business community especially exporters are making all-out efforts for export orders fulfillment and meeting the timelines, Chairman APDPA said.

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Published by M. F. Riaz, Off. 91, 3rd Flr, Gul Plaza, M.A. Rd., Karachi, for Customs Today and Printed at Dhoom Printing Press Masheer Mahal Building, Off: I. I. Chundrigar Road, Karachi