KARACHI: In line with the recommendations of the Prime Ministers Steering Committee on Anti-smuggling, Pakistan Customs being the country’s lead Anti-Smuggling Organization has accordingly stepped up enforcement actions in coordination with other Law Enforcement Agencies.
Pakistan is losing around $3.0 billion worth of revenue a year, due to smuggling of goods that are making their way through porous borders and, more alarmingly, through high sea and containerized cargo with full support of the state machinery.
A large quantity of the smuggling was due to Afghan Transit Trade Agreement (ATTA) cargo. An official said that despite dozens of check posts manned by various law enforcement and security agencies, the smuggled goods find their way from the borders to the markets of urban centers including Karachi and Lahore etc.
The official said the Federal Board of Revenue (FBR) therefore devised a new strategy targeting sale and purchase of smuggled goods. FBR is of the view that if the sale and purchase of smuggled goods is curtailed, the transportation of such goods would also stop.
On the instructions of Syed Shabbar Zaidi, Chairman FBR, Customs Wing has issued instructions to all its field formations to verify the genuineness of all seized conveyances being used to transport smuggled goods through verification from Forensic Science Laboratory, Registration Database of Excise & Taxation Department and Customs Clearance documents.
The field formations have been further instructed to initiate separate legal proceedings in case such conveyances are found to be smuggled or with tampered chassis number.
These instructions will greatly help in dismantling the smuggling network being used to transport smuggled goods.
According to a report prepared by Tariq Huda, while he was Collector Customs Preventive Karachi, by curbing smuggling, the country can increase its tax-to-GDP ratio by another 3.9% to 15% within a year. Compared to India’s smuggling to GDP ratio of only 0.43% and Bangladesh’s 0.04%, Pakistan’s ratio is incredulously high, largely owing to involvement of the FBR officials, FC, Coast Guards and Maritime Agency.
“Majority of the foreign investment has left the country and more is leaving, as they cannot compete with the profit margins, which smuggled goods generate for those who are involved”, lamented the study.
The study noted that reducing tariffs to curb smuggling has not worked thus far; it has rather had a detrimental effect on the domestic industry, which would have to compete with even cheaper imports.