ISLAMABAD: The Cabinet’s Economic Coordination Committee (ECC) stands ready to rationalize tariffs on hundreds of items, including vehicles and others, requested by the Ministry of Industry and Production (MoI & P) and other sectors Wednesday (today), according to sources close to the Secretary of Commerce said Business recorder.

The National Tariff Policy 2019-24 (NTP) states that all proposals to levy, change or remove tariffs must be reviewed at the Tariff Policy Center and, after approval by the Tariff Policy Council, must be submitted to Cabinet or to Parliament, as the case may be, for consideration.

According to sources, these are Federal Cabinet directives dated July 6, 2021 in the deferred proposals of the summary presented by the Ministry of Commerce regarding the removal / imposition of duties on various elements of the automotive sector.

The Ministry of Industry and Production (Mol & P) has proposed the imposition of regulatory fees on electric vehicles, hybrid vehicles and conventional motor vehicles (ICE) in CBU condition (fully built unit).

They also proposed levying a federal excise tax on locally assembled vehicles to curb the strong growth of automotive imports into the country, causing the trade deficit to widen.

The sources argued that at the 34th meeting, the Tariff Policy Board (TPB) endorsed the proposals from the Ministry of Industry and Production. The TPB’s decision was reiterated at its 35th meeting, in order to provide more clarity in the recommendations / rulings, as suggested by the Federal Board of Revenue (FBR).

The proposals related to the automotive sector are: the imposition of 50 percent DR on the import of electric vehicles with more than 50 kWh of battery; (ii) R&D on hybrid vehicles (CBUs) to increase from 15 percent to 50 percent on vehicles from 1,501 cc to 1,800 cc; (iii) R&D on import of CBU (normal gasoline vehicle) to increase from 15 percent to 50 percent; (iv) DEF on locally manufactured cars / SUVs from 1,501 cc and above to increase to 10 percent (existing is 5 percent); (iv) FED on 1,501 to 1,800 cc cars / SUV in CBU condition to increase to 10 percent (existing is 5 percent).

In addition, the TPB also decided, on the recommendations of the Tariff Policy Center (National Tariff Commission), to impose 10% DR on polypropylene textile materials (HS code 5402.4800, 5402.5300, 5402.6300, 5404.1200, 5503.4000, 5506.4000) in order to remedy the tariff anomaly. at the request of industry, to remove 5% RD on varnishes (HS code 3208.2010) as they are used in the manufacture of furniture, and to impose 20% RD instead of the anti-dumping duty on the importation of carbonate from sodium (HS code 2836.2000) at the request of industry and the National Tariff Commission (NTC) for a period of 6 months.

In view of this, the Ministry of Commerce proposed that changes regarding the imposition / removal of R&D on several elements in accordance with the decisions of the TPB taken at its 34th and 35th meetings, could be authorized.

Prime Minister Imran Khan, as Minister of Commerce, saw and authorized the submission of the summary to the Cabinet ECC as well as views / comments from FBR and Mol & P.


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