ISLAMABAD: The Federal Board of Revenue (FBR) has waived off penal surcharge on the overstayed bonded goods and imported items to be cleared from customs warehouses from July 13 to July 31, 2020.
In this regard, the FBR has issued a notification here on Monday to facilitate the importers.
According to the notification, the FBR has extended the existing warehousing period of already inbonded goods for a further period upto July 31, 2020. The FBR has also remitted penal surcharge in the case of goods which are cleared from the warehouses within the period starting from the date (July 13) of issuance of the notification and ending on July 31, 2020. The facility would not apply on goods which have since been abandoned or auctioned.
The Federation of Pakistan Chambers of Commerce and Industry (FPCCI) had informed the FBR the importers are also unable to ex-bond their consignments within the time period stipulated in section 98 of the Customs Act, 1969. The warehousing period as prescribed in section is six months and all overstayed consignments attract penal surcharge on clearance @ 1 per month on duty/taxes involved.
Accordingly, FPCCI had requested the FBR to consider grant of waiver of penal surcharge on overstayed consignments till June 30, 2020 in order to alleviate the problems of the importers due to fluctuation of exchange rate and other unprecedented restrictions on a range of business and economic activities triggered by Covid-19 pandemic.
The FBR had examined the matter, saying that due to fluctuation in exchange rate, coupled with other negative economic factors, the importers seem indecisive to clear the bonded goods within the statutory time limit. The data analysis shows that consignments approximately worth Rs6.822 billion involving duty and taxes of Rs4.354 billion are overstayed in bonds involving penal surcharge to the tune of approximately Rs630 million. Therefore, overstayed bonded goods on clearance would inflict additional financial burden on the importers in the shape of penal surcharge over and above the leviable duty and taxes.
The FBR observed that the federal government in similar circumstances in the past granted waiver of penal surcharge. The government may, therefore, in the prevailing situation favourably consider the waiver of penal surcharges in respect of the overstayed goods. For this to materialize, the federal government, under section 98(2) of the Customs Act, 1969, is empowered to remit the whole or part of the surcharge in case of any goods or category of goods subject to such conditions or restrictions as it may deem fit to impose, through gazette notification.
Copyright Business Recorder, 2020