The tussle between government authorities and the local used car importers have been soaring since the issuance of SRO 1067(1)/2017 by the government and made it difficult for importers to get clearance from the port. According to the government officials, the SRO was introduced to curb the trade deficit of the country which is rising due to massive import products coming into the country, automobiles being one of them.
Last year, on October 6, Economic Coordination Committee (ECC) of the Cabinet had approved that the duty and taxes of all vehicles that are imported under transfer of residence, personal baggage or under gift scheme will come from abroad; either arranged by Pakistani nationals or local recipient showing conversion of foreign remittance to local currency through bank encashment certificate.
The government strengthened the import schemes such as baggage, gift and transfer of residence as it was of the view that the schemes were made to be used by overseas Pakistanis, not for commercial purposes and also due to commercial use the economy is in bad shape.
The ongoing tussle reached its highest when local importers decided to not clear their vehicles from the port, creating gridlock at the port. As reported by many local media outlets, the importers demanded that until and unless the government doesn’t withdraw its new policy they will not be taking their cars from the port. Due to this around 6000-7000 vehicles were stuck at the port.
After the fuss, the Commerce Ministry proposed to the ECC to clear those vehicles where the bill of landing was issued on or before the 9th of January 2018 on the old duty structure.
Finance, Revenue and Economic Affairs Adviser, Dr. Miftah Ismail suggested on releasing the shipments, so the people who have imported before the SRO issuance wouldn’t have to face difficulties. Moreover, he also suggested making it effective for vehicles arriving after February 28, 2018, where the importers will have to pay their duties at the higher exchange rate. Nonetheless, one can get an idea from the pictures that the cars have been stuck even now at the port waiting to be cleared. The government should do something quickly to sort the matter, as the ones hurting in all this process are only consumers, which are waiting to get their hands on their desired cars.