Pakistan’s auto parts industry is severely affected and the country is losing valuable revenue due to various malpractices of importers of auto parts and smugglers who work in collusion with unscrupulous customs and tax officials.
Under the existing customs rules, auto parts classification is one of the major issues that affect auto parts imports since duty is calculated on the basis of weight rather than value. This creates wide disparity in the valuation of imported parts and the net result is that local auto parts manufacturers lose their competitiveness.
The government is also losing huge volumes in sales tax as a large number of auto parts wholesellers and retailers are not registered and do not generate sales invoices. This encourages open sales of smuggled and illegally imported auto parts in the market thus creating a clear disadvantage for locally produced or genuinely imported auto parts.
In most cases auto parts of inferior quality are also imported through mis-declaration, which when used in the automobiles, badly affect the reliability of these vehicles and are a safety hazard for the users.
It is imperative for the government of strictly enforce customs rules and stop smuggling of auto parts to protect the local auto parts industry and ensure safety of automobile users in our country.
SYED OVAIS AKHTAR
Karachi