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Customs Duty Customs duty is a kind of indirect tax which is realized on goods of international trade. It is categorized into Import duty and Export duty levied upon import and export of goods respectively.
Customs Act 1969 Act number. IV of 1969 Assented on 3rd March, 1969 Promulgated on 8th March, 1969 Enforced on 1st January, 1970
Definitions Adjudicating Authority Any authority which is competent to pass any order under the Custom Act,1969.
Definitions(Cont’d) Appropriate Officer Means an officer to whom certain functions have been assigned by or under the Customs Act,1969.
Definitions(Cont’d) Conveyance Any means of transport used for carrying goods or passengers.
Definitions(Cont’d) Custom Airport or Custom Port Any airport or port declared by the Board to be a customs airport or port for the clearance of goods imported or to be imported into Pakistan.
Custom Area The limits of the specified customs station and includes any area in which the imported good or the goods for export are ordinarily kept before clearance by the customs authorities. Definitions(Cont’d)
Detain Means to prohibit the disposal or use of goods, due to the pending of any proceedings under the act 1969 in relation to the goods or their owner. Definitions(Cont’d)
Warehouse A place appointed or licensed wherein the dutiable goods may be deposited without payment of custom duty. Definitions(Cont’d)
SCOPE OF CUSTOM DUTIES
Custom Duties Goods imported into Pakistan. Goods which are brought from any foreign country and are transported, without payment of duties ,from one customs station to another.
Regulatory Duty It is imposed on all or any of the goods specified in the First Schedule,at a rate not exceeding one hundred per cent(100%) of the value of goods. This duty is imposed on the goods at their import or export.
Additional Customs-Duty Additional custom duty shall be levied at a rate not exceeding thirty five percent(35%) of the value of goods
Special Customs Duty It is imposed on the import of such goods as are of the same kind as goods produced or manufactured in Pakistan. It is levied at a rate not exceeding the Federal excise duty (15%) leviable under the Federal Exercise Act,2005 on the goods manufactured or produced in Pakistan.
Fee and Service Charges The Government may levy fee and service charges by giving a notification in the official Gazette. The rates for fee charges will also be specified in the notification. The Government may impose such conditions,limitations,restrictions as it may deem fit to impose. The charges may be levied for examination, scanning ,inspection, sealing, de-sealing, valuation check.
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Officers of Custom
Officers A Chief Collecter of Customs A Collecter of Customs A Collecter of Customs (Appeals) An Additional Collecter of Customs A Deputy Collecter of Customs An Assistant Collecter of Customs An officer of Customs with any other designation
Declaration of Ports,Airports,Land Customs Stations, Etc
Declaration of customs ports The places which alone shall be customs ports or airports for the clearance of goods imported or to be exported. The places which alone shall be land customs-stations for the clearance of goods imported or to be exported by land or inland waterways.
The routes by which alone goods or any class of goods may pass by land or inland waterways into or out of Pakistan,or to or from any land custom-station or to or from any land frontier. The places which alone shall be ports for the carrying on of coastal trade with any specified customs-ports in Pakistan.
Prohibition and Restriction on Importation and Exportation
Counterfeit coins and currency notes and any other counterfeit product. Any obscene book, drawing, painting, representation, article, video or audio recordings. Goods having a counterfeit trade mark or a false trade description. PROHIBITION
Goods produced outside Pakistan and having any trade mark of any manufacturer, dealer or trader in Pakistan unless: The trade mark has some definite indication of the goods having been made in a place outside Pakistan. That country’s name is written in the same language and character as in the name or trade mark. PROHIBITION (Cont’d):
Goods involving infringements of copyrights, layout-design, patent within the meaning of The Copyright Ordinance 1962, The registered Design Ordinance 2000 and The Patent Ordinance 2000 respectively. PROHIBITION (Cont’d):
Exemption From Custom Duties
The Federal Government may exempt from the whole or any part of the custom duties chargeable on any of the following goods: Goods imported into Pakistan Goods exported from Pakistan Goods imported into any specified port, station or area. Goods exported from any specified port, station or area. General Powers To Exempt From Custom Duties
Board’s Power To Grant Exemptions Under circumstances of exceptional nature, the Board may exempt any goods from of the whole or any part of the customs duties chargeable thereon.
Power To Deliver Certain Goods Without Payment of Duty
The Board may authorize:
The delivery without payment of the custom duties chargeable thereon of goods which are imported only temporarily with a view to subsequent exportation.
Repayment is made for the goods which have been used in production, manufacture, processing or repair of goods that are meant for exportation. Repayment of Duty on Certain Goods (Cont’d)
Re-Importation of Goods Manufactured In Pakistan Goods produced in and exported from Pakistan if subsequently imported into Pakistan will be liable to custom duties.
Re-Importation of Goods Manufactured In Pakistan
Value of Imported & Exported Goods Imports
Customs Value of Imported Goods The transactional value shall be taken as the customs value of the imported goods. Transaction value means the price actually paid or payable for the goods when sold for export to Pakistan.
Transaction Value It includes: The cost of transport of the imported good. Loading , unloading and handling charges. Insurance cost. Commissions and brokerage but excluding the buying commission. Cost of containers forming part of the goods Labor or material cost of packing. Royalties and license fees paid by buyer.
Deductive Value If the customs value of imported goods can’t be determined then the following methods will be adopted: Ascertain the unit price at which the imported goods are sold. Deduct there from the following: The commission paid The additions made for profits and general expenses in connection with sales of imported goods in Pakistan
Deductive Value ( Cont’d): The cost of transport, insurance and other associated cost. The custom duties and other taxes payable in Pakistan. Other expense incurred in connection to import of such goods.
Computed Value Computed Value method involves the addition of the followings: The cost of value materials and fabrication for producing the imported goods. The addition usually made for profit . All other costs incurred in connection with the imports.
Fall Back Method It can be determined on the basis of a value derived from among all methods while applying them in a flexible manner to the extent necessary to arrive at a custom value.
Customs Value of Exported Goods The value at which the goods may be sold in open market for exportation. Following conditions apply for determining this value: Goods are treated as having been delivered to the buyer. The seller will bear all the expenses till the goods are on board the conveyance. The value to use patent rights and trade mark will also be considered.
Clearance of goods for home consumption Section 83 The appropriate officer may make an order for the clearance of goods if He is satisfied that: The import of the goods is not prohibited The import of goods is not in breach. When goods have been assessed When owner has paid import duty and other charges
Warehousing Section 84 Where any dutiable goods have been entered for warehousing , the owner may apply for leave to deposit the goods in the warehouse appointed under the customs Act 1969
Form of application (Section 85) There will be an application form in writing signed by the applicant
Warehousing bond Section 86 When any such application has been made in respect of any goods, the owner of the goods shall execute a bond , binding himself to Observe all the provisions To pay all duties , rents , charges and surcharge at the rate of KIBOR plus 3% per annum. To discharge all penalties incurred in case of violation of the provisions of the law.
Forwarding the goods to warehouse Section 87
Goods shall be forwarded in charge of a custom officer to the warehouse
A pass shall be sent with the goods specifying all the details about goods
Receipt of goods at warehouse Section 88 The pass shall be examined by the warehouse keeper Returned to appropriate officer Only correspondent goods will be entered as mentioned in the pass
Payment of rent and warehouse dues Section 96 The owner has to pay monthly rent and warehouse dues within 10 days of the demand notice, at such rates as the collector of customs may fix. In case of default, the appropriate officer may order to sell sufficient portion of the goods Proceeds of such sales shall be adjusted
Period of warehousingSection 98
Clearance of bonded goods Section 104-107
The owner may clear the warehouse goods for home consumption by paying
The duty under customs Act, 1969
All rents, penalties, charges and surcharges payable