$4.4bn losses in Pak-China Trade to Under-Invoicing
KARACHI: Discrepancies in official trade data of Pakistan and China lend credence to suspicion of massive under-invoicing by Pakistani importers in bilateral trade between the two countries.
It implies that Pakistan is losing billions of rupees in revenue, industry leaders said.
The Pakistan Business Council (PBC) made a startling disclosure in a recent study about discrepancies in the official bilateral trade data of the two countries.
The PBC has quoted China’s reported exports to Pakistan during 2013 at $11.019 billion whereas Pakistan’s reported imports from China stood at $6.623bn in the same period. This shows a huge difference of $4.4bn.
Towel Manufacturers Association (TMA) Chairman Mehtabuddin Chawla said it seems massive under-invoicing is going on.
The quoted figure implies customs duty is evaded on merchandise worth $4.4bn, or Rs440bn, which means that the government is losing as much as Rs112bn at the rate of 10pc customs duty and 15pc sales tax.
Similarly, there is a discrepancy in Pakistan’s export figures to China.
According to the study, China’s reported imports from Pakistan in 2013 stood at $3.196 billion whereas Pakistan’s reported exports to China stood at $2.652 billion in the same period.
A huge difference of $544 million in the official figures gives strength to the notion that this amount could be coming back to the country through unofficial banking channels.
Pakistan Bedwear Exporters Association (PBEA) Chairman Shabbir Ahmed said that the Federal Board of Revenue (FBR) keeps on ignoring revenue leakages and the existing taxpayers are targeted for improving revenue position of the government.
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