News
Move to end stalemate over vehicles imported through third countries
View(s):Representatives of the Finance Ministry, Import and Export Department, Customs and the Attorney General will submit proposals to court this week to end the stalemate over about 1,000 vehicles imported through third countries.
The vehicles have remained at the port for nearly three months after they were imported through cross-border Letters of Credit (LCs) in a bid to pay lower taxes. The initial plan was to re-export the vehicles to their country of origin, but the move was abandoned as it was a violation of the valuation agreement between the World Trade Organisation (WTO) and the Customs Department.
Six importers sought relief from the District Court to have their vehicles released, saying they have done the necessary declarations to the customs.
Cross-border LCs are LCs opened in a third country, such as Singapore, while the country of origin is another, like Japan. This allows vehicle imports to bypass declaring the original value of the vehicle, and this avoids heavy duties.
“We hope to suggest a settlement to the court so this issue can be resolved,” a Customs official said.
Since the relaxation of vehicle imports on February 1 this year, some 213,500 vehicles have been imported. This includes motorcycles.
The total CIF value of these imports is Rs 314 billion, while the total tax revenue from vehicles was Rs 446.84 billion. (Up to 7th September)
Up to now, vehicles with a CIF value of over USD 1 billion have been cleared.
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