Karachi    -   Commercial importers and traders have agreed to pay sales tax at retail price but insisted that the same should not be collected at import stage. These views were expressed by the commercial importers and traders during the 4th meeting of the FPCCI standing committee on Customs Agents, which was chaired by Vice President FPCCI Arshad Jamal and Convener Muhammad Sajid at Federation House. In federal budget 2019-20, the government has included finished articles in the Third Schedule of Sales Tax Act, 1990, showing its intention to aggressively discourage commercial imports and ease the pressure from import bill. According to a circular issued by Pakistan Customs, as per the measures taken through federal budget 2019-20, the items listed in Third Schedule of Sales Tax Act, 1990 shall now be assessed at the retail price at the import stage. The customs department also directed that retail prices should also be printed on each individual item in the manner as specified in clause (a) of sub-section (2) of the section 3 of the Sales Tax Act 1990. However, during the interim period up to July 31, 2019, the clearance may also be allowed if the imported items are affixed with sticker, showing declared retail price.

Vice President FPCCI Arshad Jamal said that this amendment has spread panic among the commercial importers, who were reluctant to get released consignments from ports, adding that commercial importers before the said amendment cleared their consignment as per customs value however, now they had been directed to print retail prices on each individual item and the customs department would now clear consignments on the basis of declared retail price, putting excessive burden of additional packaging cost on the importers. In addition, majority of purchases is not being made directly from manufacturers but from international local markets hence it is impossible for the commercial importers to determine retail price of the finished article including all overheads and print the same in the exporting country, he said and added that manufacturers were also reluctant to print retail price for Pakistani markets on their products.

Therefore, the government should allow the importers to declare estimated retail price in goods declaration but printing of retail price on the products and the payment of sales tax should be allowed at the time of delivering the goods to the retailers to clear the backlog of the consignments of finished articles at ports.  Furthermore, he said that business community had supported this government initiative and now requesting the government to ensure not only the printing of retail price but also the names of manufacturer and importer along with the number of goods declaration on the imported products to avoid smuggling and other malpractices.