FinanceNews

Customs Self-Assessment pilot project from next fiscal year

ISLAMABAD (February 27 2003) : To provide unhindered Customs clearance to the importers within 24 hours, the Central Board of Revenue (CBR) has decided to launch Customs Self-Assessment pilot project from next financial year.

The International Monetary Fund (IMF) has approved in principle the new procedure of the Customs Self-Assessment for early clearance of import consignments.

CBR Member Tax Policy and Reforms M.S. Lal told Business Recorder Wednesday that under the modified Customs Self-Assessment procedure, the importers would themselves finalise all the details of the shipment before the arrival of the consignment at the Karachi International Container Terminal (KICT).

The importers would be well aware before the arrival of consignments at Karachi about the examination details of the cargo.

Lal said that the basic concept of the self-assessment scheme was to facilitate the importers to themselves deal with the procedural requirement.

Presently, the late clearance of consignments was creating burden on the importers in financial terms, ultimately recovered from the consumers.

The main flaws of the existing system were that the importer has to face cumbersome official procedure, while filing bill of entry.

The new system would be more exporter-friendly as it would require less official interference.

Under the self-assessment scheme, the face-to-face contact between the taxpayers and the Custom officials would be eliminated to the maximum extent, Lal said.

The member tax policy and reforms specified that the examination of the consignments would be made on the basis of risk management on selective criteria.

There would be no interaction between the importers and tax officials where no risk factor was involved.

A certain percentage of consignments, ranging between 5 to 20 percent would be checked to eliminate risk factors.

Under the new scheme, the CBR would also introduce selection criteria on the basis of risk factors from July-August 2003.

While quoting examples, he explained that the consignment of edible oil reaching Pakistan from Malaysia certainly have low risk factor as compared to Chinese consignment coming to Sialkot Dry Port through Dubai.

The new computerised automation system could detect high-risk cargo for the purpose of examination replacing the existing 100 percent checking of shipments coming into Pakistan.

Lal was confident that the clearance of consignments from eight days to 24 hours would not only remove difficulties being faced by the importers, but would be a major step towards making the system more efficient under the tax reforms plan.

He said that the new scheme could not be easily swallowed by the Customs clearing agents and officials, as it would ultimately minimise interaction between the taxpayers and Customs functionaries.

The Customs clearing agents might oppose this system, but it was necessary to implement the new system to facilitate the business community, particularly, importers.

The basic infrastructure for the implementation of the project already exists, however, the consultants have assumed that the CBR would require around $ 1-1.5 million for the overall computerisation of the system at ports and dry ports.

In most of the countries, the time of the clearance of consignment was usually 24 hours and the CBR wanted to bring it at par with the international standards.

Meanwhile, a two member IMF mission Wednesday briefed the Central Board of Revenue (CBR) on modernisation of Customs and approved the CBR's document “The Vision”, which deals with the Customs administration reform plan to be implemented soon.

The IMF has appreciated the plan and asked the tax authorities to work on overhauling the system.

The mission held talks on the Customs reform consolidated report and gave go-ahead signal for execution at the Karachi terminal.

The CBR has constituted two project committees to work out the implementation criteria.

The first committee comprising Customs officials, information technology (IT) and human resource officials would implement the project.

The second committee would be instrumental in monitoring the progress implementation of the pilot project.

Related Articles

Back to top button
Stay up to date
Don't miss out on the latest industry news and articles
Stay up to date
Don't miss out on the latest industry news and articles
You are Subscribed!
Your subscriptions means a lot to us.
Don't miss out on the latest Industry news
You are Subscribed!