File photo by Nazar Ul Islam
As part of measures to curtail the misuse of Afghan transit trade agreement, the government on Tuesday announced it is imposing a 10 percent processing fee on items imported under the accord.
The decision, notified by the Customs Department, is aimed at deterring smuggling and ensuring proper taxation. It follows the government warning illegally residing foreign nationals in Pakistan, including an estimated 1.7 million Afghans, to voluntarily leave the country by Nov. 1 or face expulsion.
According to the Customs Department’s notification, the processing fee—calculated as 10 percent of the original value of goods—must be paid in advance during the declaration process for Afghan transit commercial goods entering Afghanistan via Pakistan. It targets items that Pakistani authorities claim are often imported for Afghanistan before being smuggled back for sale in Pakistan, including confectioneries, chocolates, footwear, various machinery, blankets, home textiles, and garments. The fee comes into force with goods declarations filed after Oct. 5, it added.
The government has also expanded the Customs Act’s jurisdiction to 10km from the borders with Afghanistan, India and Iran, compared to 5km earlier, and to 50km near certain Balochistan districts. The chief collector of customs (Balochistan), meanwhile, has been tasked with addressing smuggling issues and liaising with law enforcement agencies.
Additionally, the Commerce Ministry has notified a list of items that are banned from being imported for Afghanistan through Pakistan. According to the notification, imports of tyres, black tea, nuts and dry fruits, fabrics, cosmetics, vacuum flasks and home appliances—TVs, refrigerators, electric goods, microwaves, speakers, fans—have been banned, with officials maintaining their quantum is not commensurate with usage in Afghanistan. “In exercise of the powers conferred by the Imports and Exports Control Act 1950, the federal government is pleased to direct that in its notification of 10th Day of March 2004, following new serial numbers and corresponding entries thereto shall be inserted,” the new notification read.
Essential commodities, such as wheat, flour, sugar and urea, are exempt from the new processing fees. Similarly, goods being transited under the “foreign grant-in-aid to Afghanistan” are also exempt.
The government has also issued new draft rules to govern Afghan imports whereby Afghan importers would be required to submit bank guarantees. Authorities have granted two days for any objections to these draft rules, with them going into effect after the expiry of the deadline.
Since the return to power in Kabul of the Afghan Taliban, Pakistan has extended significant economic support to Afghanistan, including tax and duty exemptions on various commodities such as fruits and vegetables. Last year, the government had also allowed the trade of all products via land routes to Kabul in rupees.