New scheme for used vehicles import likely

The government may introduce a new scheme or regulatory framework to allow import of used vehicles by the commercial importers with imposition of certain Quantitative Restrictions (QRs). Sources told Business Recorder here on Friday that the Dr Abdul Hafeez Shaikh, Adviser to PM on Finance and Revenue, will chair a meeting on issues relating to the import of vehicles under personal baggage, transfer of residence and gift schemes for overseas Pakistanis on Monday (August 26).
The meeting would discuss possibility of introducing scheme for the commercial importers taking into account the views of Finance Division, Commerce Ministry and the Federal Board of Revenue (FBR). According to the Finance Division, the Import Policy Order, 2016 of the Commerce Division envisages various vehicles import schemes eg personal baggage, transfer of residence and gift schemes for overseas Pakistanis. This regulatory instrument allows import of new or used vehicles and is aimed to facilitate bona fide overseas Pakistanis. However, the schemes have been reported to be misused by the commercial importers, who used to import vehicles using overseas Pakistanis passports and only around 5 percent of the cars were actually being imported by genuine overseas Pakistanis. This had led to outflow of foreign exchange from the country through Hawala/Hindi and there was need of corrective measures to deter this practice. Hence, the Commerce Division prescribed a clear transaction mechanism to curb this practice and moved a summary for the ECC of the Cabinet which introduced following mechanism through amendment in the Appendix-E of the Import Policy Order.
"All vehicles in new/used condition to be imported under transfer of residence, personal baggage or under gift schemes, the duty and taxes shall be paid out of foreign exchange arranged by Pakistan nationals themselves or local recipient supported by banks encashment certificate showing conversion of foreign remittances to local currency, as under:- (i) the remittance for payment of duties and taxes shall originate from the account of Pakistani national sending the vehicle from abroad and; (ii) the remittance shall either be received in the account of Pakistani national sending the vehicle from abroad or, in case his account is nonexistent or inoperative, in the account of his family."