KARACHI: Pakistan Customs and China Customs have agreed to implement Electronic Data Interchange (EDI), which would eliminate misuse of concessionary regime under Free Trade Agreement (FTA) and revenue leakage by way of under-invoicing and misclassification would be plugged.
A meeting between the Customs authorities of both Pakistan and China will be held next week in China, which deliberate upon the modalities of the data interchange. Director Automation and Reforms Majid Yousufani would lead the Pakistan Customs’ delegation comprising Chief Automation Abdul Qadir, Riaz Chaudry and Azeem Afzal of PRAL.
It may be recalled that Federal Board of Revenue earlier this year had issued an alert regarding mis-declaration in imports from China under 50 HS codes. The Board was also concerned about the un-warranted concessions granted under various SROs covering preferential or free trade agreements.
The Board had advised verification of suspected Certificates of Origin directly through the Commercial Missions of Pakistan abroad; discouraging mis-classification of goods to obtain concessions and extending benefits only to goods which strictly matched the description provided in respective SROs.
It may be mentioned that the export data of China Customs for CY 2013 was cross matched with the import data of Pakistan Customs for same period and it transpired that in respect of 376 tariff lines the import value declared before Pakistan Customs was short by $2.437 billion that that recorded by China Customs as export value to Pakistan.
Moreover, in respect of 13 tariff lines the import value declared before Pakistan Customs was in excess of $829 million that that recorded by China Customs as export value to Pakistan. This is indicative of possible mis-classification of those goods which attract higher rates of duty but are cleared as goods attracting lower rates.