Stuck-up car issue: Car dealers urge FBR for waiver in penalties

Stuck-up car issue:   Car dealers urge FBR for  waiver in penalties

KARACHI: The decision of Economic Coordination Committee of the Cabinet’s (ECC) releasing more than 1,000 stuck up cars at the Karachi Port on paying the penalty has proved fruitless as nearly all the vehicles are still parked at the Port.
The reason of the failure was attributed to the excessive duties and penalties imposed on cars by Federal Board of Revenue (FBR), due to which the owners of these cars remained unable to pay such exorbitant penalties.
As regard of it, Chairman of All Pakistan Motor Dealers Association (APMDA) H M Shahzad in a letter to the Federal Minister of Finance and Prime Minister of Pakistan requested to order for release of held up cars of 2009 model by erasing the over-age against the payment of surcharge at 10 percent on one time waiver basis and save the owners from financial losses as well as taxes to the exchequer.
The penalty translates into 100 percent to 116 percent additional payment depending on the displacement of the vehicle. A 1000 cc car’s penalty is 100 percent, above 1000 cc till 1800 cc is 108 percent and above 1800 cc is 116 percent. He said after the ECC’s decision for penalties a car, which costs Rs 1.0 million in the local market paying the import duty, will cost us Rs 2.0 million to Rs 2.2 million.
He said those cars, which were stuck up at the Karachi Port from February till September 2013 should have a one-time penalty of 10 percent and the cars from October 2013 to January 2014 be a one-time penalty of 20 percent.
Federation of Pakistan Chamber of Commerce and Industry (FPCCI) also condemned the decision in the meeting with the owners’ delegation lead by Shahzad. FPCCI assured car dealers it would meet with federal minister for finance in this regard and request for withdrawal of unfair decision, said Shahzad.
“We have earlier requested for the release of these vehicles on one time basis against the payment of a lump sum surcharge of 10 percent on import value”. In the light of ECC’s decision the surcharge calculated approximate at 100 percent on the import value that was not sustainable by the importers, he added.
He said delay in announcement of Auto Industry Development Policy (AIDP) II was hindering growth of auto industry that should have been announced last year but government despite having consideration with all stakeholders could not announce policy yet.
He said without any guidelines auto industry was facing problems like stuck up cars, adding AIDP postponement was stemming the apprehensions that government has been influenced by local auto assemblers for their desired results.

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