Latest news with #ImportPolicyOrder
Business Recorder
15-05-2025
- Automotive
- Business Recorder
FBR may allow import of 5-year-old used vehicles
ISLAMABAD: The Federal Board of Revenue (FBR) is considering a proposal to allow import of up to five years old and used vehicles in the coming budget (2025-26) to promote competition in auto industry. Sources told Business Recorder that the proposal is to extend the current age limit on imported used vehicles from three years to five years across the board. Presently, the government allows the import of used cars up to 3 years old and SUVs up to 5 years under special schemes. The new policy may standardize the age limit to five years for all vehicle categories. Gwadar Port, GFZA: FBR allows duty, tax-free import of vehicles In the last budget for 2024-25, a 15% RD was imposed on imported used cars exceeding 1,300cc. The government is also examining the proposal to gradually phase out regulatory duties and slash tariffs on Completely Built-Up (CBU) vehicles to below 10 percent, with a broader goal of bringing auto-sector tariffs down to single digits within five years. According to a tax expert, the FBR has already taken appropriate checks to control misuse of the import of old and used vehicles. The personnel baggage scheme, transfer of residence and gift scheme were reportedly misused on the import of old and used vehicles. Under the law, the overseas Pakistanis are entitled to import vehicles under personnel baggage scheme, transfer of residence and gift scheme who have not imported, gifted or received a vehicle during the last two years under Import Policy Order (IPO), 2022. The Board had clarified that customs department will not charge 18 percent sales tax on auction of serviceable old and used vehicles in case sales tax has been paid at the time of local or import stage. However, sales tax would be charged on auction of unserviceable/ condemned old and used vehicles from the bidders, irrespective of the fact that sales tax has already been paid on such imported or locally purchased vehicles, FBR added. Copyright Business Recorder, 2025
Business Recorder
07-05-2025
- Business
- Business Recorder
Barter trade with Iran, Afghanistan: Senate panel assails MoC for proposing permanent EIF exemption
ISLAMABAD: The Senate Standing Committee on Commerce on Tuesday strongly criticised senior officials from the Ministry of Commerce for proposing a permanent exemption from the Electronic Import Form (EIF) for barter trade with Iran and Afghanistan— an act that may breach US sanctions. Neither Commerce Minister Jam Kamal nor Secretary Commerce Jawad Paul attended the meeting, citing other pressing engagements. Their absence drew further ire from the Committee, which was chaired by Senator Anusha Rahman Ahmad Khan. The Commerce Ministry's team, led by Additional Secretary Nasir Hamid, declined to share the draft summary intended for the Economic Coordination Committee (ECC) of the Cabinet. Hamid cited procedural rules that prohibit the sharing of such documents at any forum prior to ECC approval. Pakistan, Iran vow to meet potential $10bn trade target in coming years However, the Ministry informed the Committee that two separate summaries had been circulated to the Ministry of Finance, Federal Board of Revenue (FBR), and the State Bank of Pakistan (SBP) for feedback. Officials clarified that no EIF exemption had been proposed for non-Iranian origin goods, as regular banking channels are available with those countries, in line with the SBP's letter dated April 9, 2025. Currently, imports of Iranian-origin goods are exempt from the EIF requirement until May 15, 2025. This exemption— limited to specific commodities— is being extended for 45 days at a time under High Court directives. 'We need a permanent solution to the EIF issue,' said Additional Secretary Hamid. 'The FIA is pursuing Commerce Ministry officials over alleged complicity in smuggling from Iran and Afghanistan. Pakistani banks are reluctant to process such trade for fear of penalties.' The Committee expressed strong reservations about the Ministry's request to exempt certain barter transactions from the Import Policy Order (IPO) 2022, the EIF, and financial instruments required under SBP regulations— including Chapter 13 of the Foreign Exchange Manual and Circular No. 5/2-16 dated August 9, 2016. These provisions currently apply to imports of Iranian goods via land routes until formal banking channels are established. 'I don't think the ECC or SBP will approve an EIF exemption due to the sanctions,' said Chairperson Senator Anusha Rahman. 'This request is unjustified. You're asking ECC to do something that falls afoul of US sanctions. If it were legally feasible, we wouldn't have needed the EIF two years ago. You are knowingly proposing a measure the SBP cannot support. Don't embarrass the government by pushing for what cannot be done.' She urged the Ministry to identify and address the obstacles facing traders and noted that there must either be a clearly defined barter trade policy or compliance with the existing Import Policy Order. 'We formed a sub-committee to explore ways to facilitate barter trade, but its report has yet to be submitted,' she added, demanding a timeline for its completion. Joint Secretary Waqas Azeem informed the Committee that three meetings had been held and final recommendations would be submitted by next Tuesday. Additional Secretary Hamid reiterated the Ministry's intent to find a lasting resolution for trade with Iran. The Committee also discussed the matter of approximately 1,200 trucks stranded in Balochistan, reportedly carrying goods not permitted under the current barter trade policy. Haji Fojan Barech, Chairman of the Dry Fruits Importers Association, claimed the trucks held dry fruits worth millions of dollars. However, the Ministry questioned the authenticity of his claims regarding both the contents and the number of vehicles. In a sarcastic remark, Senator Saleem Mandviwala suggested writing to the High Court for a 'lifetime exemption' from the EIF if the Ministry fails to find a workable solution. 'Currently, no formal mechanism exists for trade with Iran,' he added. 'There's more smuggling than legitimate trade because of our flawed policies.' Senator Hamid Ali Khan emphasised the need for formalised trade with Iran and Afghanistan, stressing that smuggling— especially in Balochistan— must be curbed. The Ministry of Commerce is currently reviewing the existing barter trade SRO in consultation with stakeholders. Three meetings have already been held by the committee established to identify gaps in SRO 642(1)/2023, which governs the B2B barter trade mechanism. Key decisions from the last meeting held on April 7, 2025, include: (i) elimination of the current list of importable/ exportable items in SRO 642(1)/ 2023 and alignment with the IPO/ EPO 2022 and prescribed conditions; (ii) the Ministry of Foreign Affairs will provide a list of items/ entities sanctioned by the US, UN, and other organisation; and (iii) FBR will propose amendments to enable transfer of credit between contracting parties for netting off goods' value. Chairperson Rahman remained unconvinced by the Ministry's presentation. 'This issue needs to be addressed at a higher level— beyond the comprehension of those in this meeting,' she said. After over an hour of discussion, the Committee agreed to hold a joint meeting with the Finance Minister, Commerce Minister, and Governor SBP to resolve the EIF exemption and barter trade mechanism. A representative from the Policy Research Institute of Market Economy (PRIME) presented data estimating the financial impact of smuggling and the informal economy at Rs 751 billion. However, the figures related to tobacco and pharmaceuticals were contested by Senator Faisal Rehman and representatives from the Pharma Association. According to a press release, the committee directed the Ministry of Commerce to fast track summaries initiated for barter trade and for the import policy order. The Committee members directed the ministry to resolve the confusion on trade with Iran, Russia and Afghanistan through a barter system, vs the parallel trade ongoing under IPO. Senator Saleem Mandviwalla reiterated the strategic importance of barter trade in tackling cross-border smuggling, stating barter trade from Iran and Afghanistan will help prevent smuggling. Affected traders added that over 1,200 trucks have been stalled at the border, loaded under barter terms, with sesame and rice exported without involving dollar payments. The Committee also constituted a Sub-committee comprising of Senators Zeeshan Khanzada, Sarmad Ali and Faisal Rahman to provide recommendation on the tobacco sector. It was also agreed that the issue of counterfeit medicines will be reviewed by the Standing Committee on Health. Trade and Investment Officers (TIOs) posted abroad also briefed the committee on potential trade opportunities, marking a continued commitment to expanding Pakistan's global trade footprint. Present at the meeting were Senators Sarmad Ali, Faisal Saleem Rehman, Bilal Ahmed Khan, Hamid Khan, Amir Waliuddin Chishti, Saleem Mandviwalla, Zeeshan Khanzada, and Muhammad Tallal Badar, along with senior officials from the Ministry of Commerce representatives from the private sector, and trade officers posted abroad. Copyright Business Recorder, 2025
Express Tribune
06-05-2025
- Business
- Express Tribune
Senate seeks clarity on barter trade
Pakistan sees the barter trade as an opportunity to access cheaper energy from Russia and Iran, as well as coal from Afghanistan, without using dollars. photo: file Listen to article The Senate Panel on Tuesday has urged the Commerce Ministry to address confusion surrounding Pakistan's barter trade policy with Iran, Afghanistan, and Russia, warning that unclear frameworks risk undermining trade potential. The Senate Standing Committee on Commerce Chaired by Senator Anusha Rehman took up the barter trade issues with Iran. The high-level committee meeting focused on mechanisms to achieve the government's export targets, with a particular emphasis on the evolving barter trade arrangements with neighbouring countries. The committee directed the Ministry of Commerce to expedite the approval of pending summaries for barter trade and amendments to the Import Policy Order. Members expressed concern over policy ambiguity, especially regarding trade with Iran, Russia, and Afghanistan under a barter system following banking restrictions with these countries. Senator Hamid Khan criticised the existence of separate policies for barter and traditional trade, calling it "malicious," and asserting that "global trade operates under a unified Import Policy Order (IPO)." Meanwhile, Senator Saleem Mandviwalla highlighted the strategic importance of barter trade in curbing cross-border smuggling, stating, "Barter trade with Iran and Afghanistan will help prevent smuggling." Traders impacted by the delays informed the committee that over 1,200 trucks loaded with goods under barter agreements, particularly sesame seeds and ricehave been stranded at the border due to procedural hurdles, with transactions conducted outside the dollar-based payment system. In response, the committee agreed to convene a joint meeting with the finance minister, commerce minister, and the State Bank of Pakistan (SBP) governor to resolve the impasse. Documents shared with the committee revealed that the Ministry of Commerce has finalised a draft summary proposing an exemption from Electronic Import Forms (EIF) for imports of Iranian-origin goods via land routes. The exemption, aimed at facilitating trade in the absence of formal banking channels, has been circulated among the Federal Board of Revenue (FBR), SBP, and Finance Division for feedback before submission to the Economic Coordination Committee (ECC) of the Cabinet. According to the draft, the exemption from paragraph 3 of the Import Policy Order 2022 and EIF requirements under the SBP's Foreign Exchange Manual would apply solely to Iranian-origin goods imported by land, until banking channels are formally established. The exemption does not extend to non-Iranian-origin goods imported via Iran, due to the availability of regular banking arrangements with other countries. The FBR will oversee verification of the goods' origin under Section 79 of the Customs Act, 1969, and Rule 433-A of the Customs Rules, 2001. The current EIF exemption for Iranian imports is set to expire on May 15, 2025. Meanwhile, the Ministry of Commerce is reviewing the existing barter trade framework and SROs in consultation with stakeholders to operationalise the system. Key decisions from recent meetings include aligning barter trade rules with the Import and Export Policy Orders 2022, eliminating the predefined list of tradable goods in SRO 642(I)/2023, and awaiting inputs from the Ministry of Foreign Affairs on sanctioned entities. The FBR is also expected to propose amendments enabling credit transfers or netting of trade values under the barter system. The SBP, while acknowledging the necessity of EIF waivers given the absence of banking ties with Iran and Afghanistan, cautioned against potential misuse and recommended stronger controls in the WEBOC and Pakistan Single Window (PSW) systems to ensure only genuine traders benefit. The central bank further advised prioritising the operationalisation of the barter trade mechanism over continued reliance on EIF exemptions, which risk encouraging informal settlements. Additionally, the Ministry of Commerce has proposed mandatory certificates of origin for all goods imported from Iran and Afghanistan, to ensure compliance with customs regulations and to prevent circumvention of import restrictions, particularly for high-risk goods. The committee also addressed the issue of illegal trade, including smuggling of tobacco, pharmaceuticals, and tyres. A subcommittee comprising Senators Zeeshan Khanzada, Sarmad Ali, and Faisal Rahman was formed to present recommendations on the tobacco sector. The issue of counterfeit medicines was referred to the Senate Standing Committee on Health for further review. In a bid to modernise trade practices, the committee urged the Ministry of Commerce and trade associations, including towel manufacturers and the pharmaceutical industry, to adopt a digitised system introduced by private firm Galaxefi Solutions. On the committee's invitation, Galaxefi founder and CEO Asif Pervez delivered a detailed presentation on how the firm's automation and AI solutions could transform cross-border trade operations. Trade and Investment Officers (TIOs) of the Ministry of Commerce posted abroad also briefed the committee on emerging global trade opportunities, signalling Pakistan's continued commitment to expanding its international trade footprint.
