ISLAMABAD: Senate Standing Committee on Commerce and Textile on Thursday headed by Senator Mirza Muhammad Afridi grilled Federal Board of Revenue’s (FBR) top officials for their failure to control smuggling and under invoicing which is hurting domestic industry, reported Business Recorder.
Leader of the House Senator Shibli Faraz raised the issue of under invoicing of IT equipment and subsequent loss to the exchequer. This is not the first time this issue has been raised in the committee.
Senator Faraz questioned how is it possible for a Letter of Credit (LC) to be opened in the name of one person or company whereas the Bill of Lading (BL) is the name of another person/company and the consignment is cleared by a third party. He maintains that the bank has to also be involved in this exercise and has summoned the concerned bank in the next meeting. According to him, invoices were forged with the help of FBR.
On a query, Secretary Commerce Ahmad Nawaz Sukhera informed the committee that according to the import policy order, it is the responsibility of Commerce Division to devise a policy in consultation with the stakeholders. Director General Trade Commerce, Muhammad Ashraf explained the mechanism as follows: “smuggling and under invoicing of IT related goods and equipment are inflicting Rs 8 billion financial loss to national exchequer and money laundering of $400-500.”
Secretary Commerce gave a commitment to the committee that he would bring all the stockholders on board and sort this issue out within 15 days.
FBR’s official explained the steps being taken by the FBR to curb under invoicing of IT equipment which include specifications of each product along with its size. However, FBR officials acknowledged that there are issues of under invoicing and smuggling and presently 20-35 cases have been identified for further probe. The committee was informed that the main issue of smuggling is lower duties in Afghanistan.
FBR is all set to increase witholding tax on profit earned by depositors. Meetings taking place. This will specially impact widows housewives pensioners old savers.
Despite being told it will negatively impact government image and make lives difficult for the common man. PTI and journalists should investigate.