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FBR to Remove Customs Duty on Imported Goods Under Rs. 5,000

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Now Reading: FBR to Remove Customs Duty on Imported Goods Under Rs. 5,000

Federal Board of Revenue (FBR) has stated that products with a declared monetary value of up to 5000 rupees imported into Pakistan via postal or air courier services will get exemption from customs duty or any other types of taxes. This was revealed in the FBR’s draft of the “De-minimis rules for imported goods” through the issuance of S.R.O.886(I)2020 for amendments in the Customs Rules, 2001.

An FBR official went on to explain that this move has been taken to provide relief for private users wanting to get goods for personal use rather than to corporate importers. He added;

“However, this exemption is only applicable on Postal and courier goods.”

This implies that goods imported to the country through sources other than courier or postal services will not be given the same liberty, thus ensuring that private individuals benefit from it as intended and this exemption is not abused by corporate or industrial importers. With this change in import practice, the companies providing postal or courier services will be bound to enlist the imported items having a declared value of up to Rs. 5000 as per their label.

“De Minimis Rules for Imported Goods”

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The aforementioned “de minimis value” means the value of goods up to Rs. 5,000 in terms of the provisions of section 19C of the Customs Act. The “postal goods” mean goods cleared in terms of the provisions of Landing and Clearing of Parcels Rules as stated in Chapter Sixteen of the Customs Rules, 2001. Therefore, the postal or courier authorities will not be longer be obliged to file goods declaration or demand payment of duty and taxes for goods with a value up to 5k rupees.

Furthermore, a consolidated monthly e-stated of all offered clearances along with invoice copies of the imported items i.e. those cleared under these new rules shall be submitted by the postal or courier authorities to the concerned Customs authorities for reconciliation of the record in the prescribed manner. To ensure the application of the provisions of section 19C of the Customs Act 1969, the value mentioned on the label of the postal good or the courier receipt will be taken as its declared value.

FBR rules also clarified that the postal or courier authorities will follow the official exchange rate of the day prior for conversion of invoice value into Pakistani Rupees. After approval, a final notification will be issued and will come into effect the next month i.e. October 2020.

This move was long overdue as the previous limit for tax-exemption on imported goods was a measly Rs. 100, which translates to even less than $1. Now, this increased limit of 5,000 rupees will allow to import goods with up to a 30$ price tag without taxes.

 

Read also: FBR Reveals Hundreds Of NA Members Who Did Not Pay Taxes In 2018

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