Baggage scheme ‘hijacked’ by showrooms mafia
A baggage scheme which is to facilitate overseas Pakistanis to import old and used vehicles in the country is now being controlled by showrooms mafia with the support of some customs officers. This disclosure was made by Pakistan Economy Forum (PEF) in a letter sent to chairman FBR.
The forum in the letter said that imports of different vehicles continue for long and irregularities in it had now become an open secret. It said that import of old vehicles could only be made through baggage scheme, which was aimed at facilitating overseas Pakistanis, who wanted to bring personal vehicles with them. For this purpose, overseas Pakistanis are required to stay abroad for at least two years and the vehicles, which they want to import, must remain in their possession during stay abroad besides they have to produce vehicle registration certificates along with driving license at the time of clearance.
However, this scheme is now controlled by a mafia, being patronised by a lobby of some customs officers and agents. Now, majority of the vehicles, being imported under this scheme, are not owned by overseas Pakistanis but their passports are used for this purpose. The forum alleged that the mafia purchased passports of overseas Pakistanis against Rs 15,000 to Rs 25,000 for exploiting this scheme. In many cases, this mafia imprinted fake departure and arrival stamps at these passports to complete required formalities for imported vehicles clearance. This mafia has so far poured billions of rupees in this business, which has no connection with overseas Pakistanis.
It said that if the authorities only scrutinised records of overseas Pakistanis, who invested millions of rupees in vehicles’ imports, these overseas Pakistanis would be found in labour class having no capacity to buy even a bike from their income.
Moreover, the letter said that vehicles’ importers, residing in UAE or Saudi Arabia, didn’t have vehicles or even driving license but they were used to importing vehicles from Japan.
It said that overseas Pakistanis were neither involved in vehicles’ import nor were the vehicles registered in their names. He urged the authorities to take bold steps not only to provide legal support to imports of old & used vehicles but also help in eradicating malpractices in this sector. The forum in its letter has made some recommendations to make the system more effective and to provide a legal channel for importing vehicles in the country.
- Majority of imported old & used vehicles are owned by car showroom owners, hence all car showrooms must be enrolled as “VEHICLES DEALERS” in the tax department.
Allow free import of old & used vehicles to these registered vehicles dealers and collect all duty and other taxes including 1 percent income tax with import fee on each vehicle, which would be charged on the basis of CC but would not exceeded Rs 25,000.
Allow all taxpayers to import vehicles through these registered vehicles dealers with the aim to track vehicles’ possession.
All overseas Pakistanis, who intend to bring their personal vehicles in Pakistan, should also be required to register vehicles in their names in Pakistan with the condition that they cannot sell or transfer vehicle for at least three years. The PEF also urged the authorities to establish a separate research and development department to find problems and its solutions for better customs services.
Copyright Business Recorder, 2014