Checking under-invoicing, under-valuation: FBR against hiring third-party companies

The Federal Board of Revenue (FBR) has strongly opposed a proposal to outsource services to third-party companies for checking under-invoicing and under-valuation on imported consignments. Sources told Business Recorder here on Friday that the past experience of hiring of such investigative firms to check under-invoicing was not very fruitful.
In the past, the government tried to hire a few firms for third-party inspection and controlling under-invoicing, but the authorities were unable to achieve the desired results. There is a need to check under-invoicing through proper placing checks and verification of relevant import documents etc. However, the idea of outsourcing checking facility to third-party companies would not be appropriate.
During last meeting of the Tax Reform Co-ordination Group (TRCG), it was decided that a Valuation Committee will be constituted which would include, inter alia FBR, Governor SBP, Ministry of Commerce and stakeholders from the private sector to come up with measures to deal with misdeclaration and under-invoicing including availability of reliable valuation data. The TRC Group also decided that Chairman FBR would look into improving equipment support for preventing smuggling such as scanners, weighbridges and tracking systems as well as developing integrity and human capacity.
When contacted, a tax expert said that the FBR has to take measures to resolve valuation disputes and control massive under-invoicing by levying accurate rate of customs duty on the imported consignments. It is extremely difficult to check "group under-invoicing", as a group of importers of same commodity or some association declare same value of imported item to commit under-invoicing.