Footwear importers recommend scrutiny of the affairs of M/s Service, M/s Bata

KARACHI: A delegation of footwear importers including as well as representatives of M/s Bata and M/s Service met with Director of Customs Valuation Wasif Memon to press downward revision in the values of imported footwear ended inconclusive.

Representative of M/s Service, Mehmood, said M/s Service did not have any manufacturing facility and informed that they imported footwear from China and also procured from the local vendors. These goods are then sold under the title of Service. M/s Bata however has manufacturing facilities. These local companies were of the view that the Valuation Ruling No. 859/2016 was correct and there was no flaw in it.

Importers were of the view that the local companies i.e. M/s Service and M/s Bata were over-invoicing their imports adding that they could provide similar goods supplied by same vendors at almost half of the price, which the M/s Bata and M/s Service were declaring at import stage.

The dispute between importers and manufacturers was not settled and the meeting ended.

Talking to Customnews.pk, importers said that the local manufacturers were actually misleading the department and wanted to create a monopolistic environment in the country’s footwear market through getting the values manipulated.

It was known that M/s Service was owned by a former federal minister. M/s Service is registered as a manufacturer despite that they do not have any in-house manufacturing facility; they are also availing inadmissible benefit of concessionary SROs.

Importers suspect that declaring imports at much higher rates may suggest possibility of laundering the money out of country in a seemingly legitimate way.

According to data provided to Customnews.pk, M/s Bata imported footwear and raw material worth over Rs2.0 billion and M/s Service imported raw material and footwear worth over Rs6.0 billion in the last fiscal year.

It is suspected that these manufacturers are trading the imported raw material in the local market, which is actually imported under concessions.

Importers requests Director General Syed Tanveer Ahmed and Director Wasif Memon that the affairs of these local manufacturers should be looked into and measures should be taken to ensure level-playing field for all stakeholders of the country’s footwear industry.

Importers also said that local manufacturers’ affairs regarding withholding of sales tax on payments to vendors should also be checked, whether they are complying or not.

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