NBR makes changes in HS Code to help resolve disputes over duty
Doulot Akter Mala | Thursday, 19 June 2008
The government has brought uniformity in Harmonised System of Code (HS Code) of 47 products to resolve disputes over fixation of applicable duty on the same category products under different codes.
The National Board of Revenue (NBR) has made the change in the budget for the fiscal 2008-09 in the backdrop of widespread complaints by businessmen on the complexities that arise while selecting imported products at the port.
The board has changed HS code description of five products while split seven, deleted 19, merged five and included new 11 HS codes.
The revenue board, in customs related new measures for fiscal 2008-09, has made the change. The changed measures sent to the chiefs of all customs wings after budget announcement.
With the recent change, a number of products belonging to the same category will fall under the same rate of duty structure, an official said.
Disputes between customs officials and importers will be minimised with the imposition of same duty on import of same products, he said.
A high-powered committee of the revenue board has made the change for the upcoming fiscal after conducting a detailed study on simplification of the HS code system.
The committee has assessed the impact on tax revenue collection if the same rate of duty is imposed on same category of products falling under different codes, an official source said.
Around 16 HS codes have been merged into five that include low lift pumps for agricultural, shallow tubewell, deep tubewell, submersible pumps, swimming pools.
The NBR included new HS codes for drugs for thalassemia, surface coloured or printed paper or paper board, ventilation exhaust fan, microbus of cylinder capacity not exceeding 1800 cc, chassis fitted with engine, for the motor vehicles of heading 87.02 in CKD condition, pre-payment KWH meter etc.
The HS codes are used by importers and customs officials to help determine the exact nature of goods being imported and duties that have to be paid against import of such consignments.
Problems usually arise when a particular item is included in multiple headings of the HS code having different rates of customs duty.
Same product with simple variation falls in higher duty slab, which is resulting in misunderstanding between customs officials and importers, officials said.
Uniform duty for a single category of product will minimise the number of over and under invoicing mostly carried out by taking advantage of variable duty structure.
"We have to physically examine imported consignments as different duty slabs apply for a single product category," an official said adding that HS code simplification will help expedite unloading of products with easy product category determination process.
With the unified HS codes of the same products, scope of 'interpretation' on duty structure and under-hand dealing will also be reduced.
The problems in HS code determination is one of the major reasons for customs related disputes between businessmen and customs officials.
In the tax ombudsman's office, around 90 per cent of the complaints about irregularities in indirect tax relate to HS codes.
The National Board of Revenue (NBR) has made the change in the budget for the fiscal 2008-09 in the backdrop of widespread complaints by businessmen on the complexities that arise while selecting imported products at the port.
The board has changed HS code description of five products while split seven, deleted 19, merged five and included new 11 HS codes.
The revenue board, in customs related new measures for fiscal 2008-09, has made the change. The changed measures sent to the chiefs of all customs wings after budget announcement.
With the recent change, a number of products belonging to the same category will fall under the same rate of duty structure, an official said.
Disputes between customs officials and importers will be minimised with the imposition of same duty on import of same products, he said.
A high-powered committee of the revenue board has made the change for the upcoming fiscal after conducting a detailed study on simplification of the HS code system.
The committee has assessed the impact on tax revenue collection if the same rate of duty is imposed on same category of products falling under different codes, an official source said.
Around 16 HS codes have been merged into five that include low lift pumps for agricultural, shallow tubewell, deep tubewell, submersible pumps, swimming pools.
The NBR included new HS codes for drugs for thalassemia, surface coloured or printed paper or paper board, ventilation exhaust fan, microbus of cylinder capacity not exceeding 1800 cc, chassis fitted with engine, for the motor vehicles of heading 87.02 in CKD condition, pre-payment KWH meter etc.
The HS codes are used by importers and customs officials to help determine the exact nature of goods being imported and duties that have to be paid against import of such consignments.
Problems usually arise when a particular item is included in multiple headings of the HS code having different rates of customs duty.
Same product with simple variation falls in higher duty slab, which is resulting in misunderstanding between customs officials and importers, officials said.
Uniform duty for a single category of product will minimise the number of over and under invoicing mostly carried out by taking advantage of variable duty structure.
"We have to physically examine imported consignments as different duty slabs apply for a single product category," an official said adding that HS code simplification will help expedite unloading of products with easy product category determination process.
With the unified HS codes of the same products, scope of 'interpretation' on duty structure and under-hand dealing will also be reduced.
The problems in HS code determination is one of the major reasons for customs related disputes between businessmen and customs officials.
In the tax ombudsman's office, around 90 per cent of the complaints about irregularities in indirect tax relate to HS codes.