Import of vehicles: Ministry convenes meeting of stakeholders today

Commerce Division has convened a meeting of stakeholders on Monday (today) to chalk out practicable mechanism for import of vehicles under Personal Baggage, Transfer of Residence and Gift Schemes, well informed sources told Business Recorder.
These facilities are being misused by the importers who buy the use of the passports of overseas Pakistanis ranging from Rs 5000 to Rs 50,000 to import used cars and sell in the market as commercially imported vehicles. Many influential people including politicians are engaged in "illegally" imported used cars.
Giving the background, the sources said, the ECC of the Cabinet in its meeting held on October 6, 2017 considered the summary moved by Commerce Division on "import rationalization" and approved that "all vehicles in new/used condition to be imported under transfer of residence, personal baggage or under gift scheme, the duty and taxes will be paid out of foreign exchange arranged by Pakistan Nationals themselves or local recipient supported by bank encashment certificate showing conversion of foreign remittance to local currency".
There are speculations that used cars imported "paid" a heavy price to get this decision, but it is not clear who pocketed millions of rupees.
Pursuant to the decision of ECC of the Cabinet, Commerce Division notified the decision on October 20, 2017. However, the implementation of the decision created some problems for those importers who had already purchased the vehicles. Resultantly, consignments of the vehicles that arrived have been stuck.
The sources said, Prime Minister's Office desired that Commerce Division and Federal Board of Revenue may reconsider the proposal of automobile importers put forward in this regard.
Furthermore, Finance Minister recommended that the new requirements be given effect for vehicles arriving after February 28, 2018 to allow pre-shipped vehicles to be cleared under the old regime. During the period up to February 28, 2018, the importers could be required to pay duties at the higher inter-bank and open market foreign exchange rates.
Keeping in view this entire situation Commerce Division submitted a summary to the ECC on January 22, 2018, proposing to change the date of effectiveness of new requirements with effect from January 9, 2018.
The ECC of the Cabinet instead of approving the proposal by Commerce Division to change the date of applicability of the SRO, recommended reverting to the position prior to the issuance of SRO 1067(1) /2011 and holistically deliberating on the rational policy options in consultation with stakeholders.
In pursuance of ECC's decision SRO.261(I)/2018 was issued on February 23, 2018 reverting the policy with regard to import of vehicles under Personal Baggage, Transfer of Residence and Gift Scheme prior to the' issuance of SRO.1067(I)/2017 of October 20, 2017.
The sources said, a meeting was held on March 6, 2018 attended by representatives from Federal Board of Revenue. Ministry of Industries & Production, Ministry of Overseas Pakistanis, Overseas Pakistanis Foundation, State Bank of Pakistan . Engineering Development Board and Finance Division to deliberate on policy options to curb the misuse of facility provided by the policy in vogue, regarding import of used vehicles by commercial importers which may not affect the real stakeholders.
The sources said, various policy options were discussed; however, no consensus was developed during the meeting. The meeting concluded with the decision that the participants would furnish their views to Commerce Division. Thereafter, Commerce Division received divergent policy inputs from various public stakeholders which could not be adopted as policy since they are not in consonance with each other. Commerce Division will submit a summary to the ECC after getting viewpoints of different stakeholders.