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Business Recorder
21 hours ago
- Business
- Business Recorder
Import of Iranian scrap: DG Customs Valuation likely to take up matter of revision of values
ISLAMABAD: The Directorate General Customs Valuation Karachi is expected to take up the matter of revision of customs values on the import of Iranian origin scrap, which is imported exclusively via land routes of Taftan, Panjgur, and Gabd. The issue has been taken up by Quetta Chamber of Commerce and Industry (QCCI) President Muhammad Ayub Maryani with the officials of the directorate valuation Karachi. The industry has requested the directorate an urgent review of Valuation Ruling No. 63/2025. New customs values on import of iron & steel scrap fixed According to the sources, the Director General Customs Valuation Karachi will review the request of the industry on realistic assessment of duties and taxes on the import of low quality of Iranian Scrap. According to the QCCI presentation to the directorate, with reference to Valuation Ruling No. 63/2025 dated 08-08-2025, issued after the stakeholder meeting held on July 29, 2025 under section 25A of the Customs Act, 1969, the Quetta Chamber of Commerce & Industry (QCCI) conveyed its gratitude for allowing a deduction of US$ 60/MT on LME-linked customs value for scrap imports through land routes on account of freight. This recognition of freight advantage for land route trade is highly appreciated. However, after carefully further reviewing VR 63/2025, it has been found that the US$ 60/MT deduction does not fully reflect the unique economic realities of Iranian origin scrap, which is imported exclusively via land routes (Taftan, Panjgur, and 250-Gabd) and is not imported through any seaport of Pakistan or elsewhere due to U.S. sanctions. Key Considerations Supporting Urgent Revision of VR 63/2025: a) Lower Quality of Iranian Scrap: 'Iranian and CARs-origin' scrap is generally of lower quality compared to European/US scrap. This factor has historically been recognized in customs valuation through deeper discounts. b) The Sales Tax SRO 170(1)/2008: When customs duty on scrap imports was zero, FBR issued Sales Tax SRO 170(1)/2008 dated 22-02-2008, wherein the assessed value for re-rollable scrap imported via land routes from Iran/Afghanistan was fixed at US$ 275/MT on account of its inferior quality and low freight charges, whereas the value for scrap at sea ports remained US$440/MT at that time. This policy clearly reflected both the lower quality and the cheaper rate of Iranian scrap due to sanctions. c) The Valuation Ruling (VR 1566/2021): A 35 percent discount was accorded to land route scrap imports, which satisfied stakeholders and aligned with market realities. The present deduction of US$ 60/MT is substantially below this benchmark. In light of the above, and under the powers vested in the Director General Valuation under Section 25D of the Customs Act, 1969, the Quetta Chamber of Commerce & Industry requested an urgent review of Valuation Ruling No. 63/2025. The industry urged that a realistic and equitable discount be restored, ideally closer to the precedent of 35% under VR 1566/2021 or at least in line with the historic precedent of 37.5 percent discount reflected in Sales tax SRO 170(1)/2008. Copyright Business Recorder, 2025
Business Recorder
6 days ago
- Business
- Business Recorder
New customs values on import of iron & steel scrap fixed
ISLAMABAD: Directorate General of Customs Valuation Karachi has fixed new customs values on the import of Iron & Steel Scrap (Re-meltable/ HMS/ Shredded/Re-Rollable Scrap from all origins. According to a valuation ruling issued by the directorate on Wednesday, the customs values of Iron & Steel Scrap (Re-meltable/ HMS/Shredded/Re-Rollable Scrap determined vide Publication Valuation Ruling No. 5612025 dated 8.02.2025. The Chamber of Commerce & Industry, Quetta (QCCI), M/s Mehmoob Re-rolling Mills and M/s Amir Asim Steel Re-rolling Mills (Pvt) Ltd, filed a review appeal under Section 25D of the Customs Act, 1969 before the Director General, Directorate General of Customs Valuation. The Director General vide its Order-in-Revision No. 3112025 dated 24.04.2025 remanded back the case with directions that the Directorate, reconsider the percentage of freight discount. The matter requires re-examination, taking into account all relevant documentary evidence and after affording ample opportunity of hearing to the petitioners, so as to address and resolve the issue appropriately. The Directorate initiated the exercise for re-determination of the customs values of the afore-stated items under Section 25-A of the Customs Act, 1969. A meeting was held with key stakeholders, including the Pakistan Ship Breakers' Association, Pakistan Association of Large Steel Producers and QCCI, to discuss the valuation of imported goods. The QCCI President argued that Iranian-origin goods are cheaper due to lower quality and land-route transportation, and therefore merit a higher freight discount. However, other stakeholders maintained that the existing discount is fair, and cautioned that increasing it beyond seven percent would adversely impact importers using sea ports, leading to market distortion and competitive imbalance. The Directorate assured that all concerns will be reviewed in light of documentary evidence and after affording a fair hearing to all parties. The ruling said the valuation methods given in section 25 of the Customs Act, 1969 were applied sequentially to address the valuation issue at hand. The transaction value method as provided in sub-section (1) of Section 25 of the Customs Act, 1969, was found inapplicable as declared values do not correspond to market prices. The values of identical and similar goods as per sections 25 (5) & (6) ibid could not be solely relied upon due to absence of absolute demonstrable evidence of qualities and quantities of commercial level etc. Market enquiry as envisaged under sub-section (7) of Section 25 of the Customs Act, 1969 was conducted but could yield no results as prices varied according to selling point in the market. Computed value method as provided in Section 25(8) could not be applied for valuation of the aforesaid goods, because the manufacturing cost of originating countries are not available. Copyright Business Recorder, 2025
