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ISLAMABAD: The Senate Standing Committee on Finance Wednesday directed the Ministry of Finance to stop the Pakistan Civil Aviation Authority (PCAA) from collecting foreign currency information through the customs’ declaration forms by all inbound passengers of international flights.

Chairman of the committee Senator Saleem Mandviwalla said that till a viable mechanism is placed at the airport, the CAA should be immediately stopped from asking for the details of currency brought into Pakistan by international passengers. There is total confusion at the airports and the said directive should be suspended until a proper mechanism is in place, he added.

The issue came to light when Senator Kamil Ali Agha asked the State Bank of Pakistan (SBP) to explain under whose authority the CAA had issued a circular on disclosure restrictions from international passengers.

SBP Deputy Governor Dr Inayat Hussain stated that the exchange companies are required to get prior permission for the export of dollars from the country. The CAA has imposed a restriction on the incoming passengers to declare foreign currencies. The CAA has given directions to the airlines in this regard.

As per our understanding, the circular was issued in consultation with the customs authorities, he added.

Issuance of boarding pass to be linked to currency declaration at airports: Customs

Federal Board of Revenue (FBR) Chairman Asim Ahmed informed the committee that the FBR has not given any directions to the customs to collect any new form from the incoming passengers.

Senator Agha stated why the CAA is monitoring and controlling the dollars.

Dr Aisha Ghaus Pasha, State Minister for Finance informed that the CAA has not issued the said directive on its own but the same was already present but was not enforced.

A number of changes in the rules have been made to check the movement of the currency in line with the Financial Action Task Force (FATF) standards. The rules were already in place but the director general Financial Monitoring Unit implemented measures in the presence of the FATF team in Pakistan.

The SBP deputy governor requested the committee not to suspend the circular of the CAA, but the committee directed to implement the committee recommendations.

Deliberating over details regarding the export of excess foreign currency cash as permitted by the SBP, the committee was informed that the SBP issues special permissions to export defaced/small denomination/soiled USD cash notes. In order to carry out exports, it was asserted that Exchange Companies (ECs) have to comply with all relevant regulations.

Regarding currency declaration counters established by the CAA at all airports in Pakistan where passengers travelling on international routes are bound to declare the volume of foreign currencies at both arrivals and departures, the Committee was informed that this was due to the existing FATF limits that call for stringent monitoring of foreign exchange that is let out of the country.

The committee directed the ministry to provide details in 15 days after streamlining the process in order to facilitate passengers.

The SECP chairman informed that the stolen data of the companies maintained by the SECP has not been sold on the dark web.

Discussing the SECP data breach; the availability of details of registered companies on the dark web, the members of the Committee were of the view that the matter had been highlighted out of proportion and that the SECP must revamp online security. The committee was informed that the matter is being investigated and a report will be submitted to the committee soon.

Reviewing the matter of increased taxes on mobile phones, the committee was informed that a temporary ban was imposed on the import of mobile phones due to the current account situation in the country. However, no new taxes have been imposed. The reason for the increase in prices is due to regulatory duties on the recommendation of the National Tariff Commission. It was revealed that regulatory duties imposed are independent of the money bill and can be charged any time.

Discussing difficulties faced by importers due to high dollar rates charged by commercial banks for opening LCs, the committee took strong notice of the matter and stressed the need for measures to address the matter; since the future of the industry and trade depended on this. It was asserted that numerous businesses are on the verge of shutting down due to this. Market sentiment has experienced an all-time low. The committee recommended that a meeting with a single-point agenda regarding this matter must be conducted soon.

The meeting was attended by senators Saadia Abbasi, Mohsin Aziz, Farooq Hamid Naek, Talha Mehmood, Kamil Ali Agha, Anwarul Haq Kakar, Zeeshan Khanzada, Faisal Saleem Rehman, Dilawar Khan, and senior officers from the Ministry of Finance and Revenue and Economic Affairs, the Federal Board of Revenue (FBR), the State Bank of Pakistan (SBP), and the Securities and Exchange Commission of Pakistan along with all concerned. Minister of State for Finance and Revenue Aisha Ghous Pasha was present as well.

Matters taken up included exporting of excess foreign currency cash as allowed by the SBP; the SECP data breach; availability of details of registered companies on the dark web and the issue of increased taxes on mobile phones. The committee also discussed difficulties faced by importers due to high dollar rates charged by the commercial banks to open LCs.

Copyright Business Recorder, 2022

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