Govt Revises Customs Values of Old and Used Auto Parts to Ensure Fair Assessment

ISLAMABAD: The Directorate General of Customs Valuation Karachi has announced revised customs values of old and used auto parts, covering 189 categories including engines, gearboxes, dashboards, and AC compressors, to ensure accurate duty assessment and prevent under-invoicing.

These revised customs values will now be applicable on the import of used auto parts originating from all countries. Additionally, the directorate has clarified that while each item will be assessed at its respective determined value, the total customs value of a consignment must not fall below $600 per metric ton.

The ruling comes after multiple representations were received requesting redetermination of customs values. Considering recent import data, local market trends, and price discrepancies, a valuation exercise was initiated under Section 25A of the Customs Act, 1969.

Consultative meetings were held with key stakeholders, including importers, local manufacturers, and members of Old & Used Auto Parts Importers Association and Sindh Auto Parts Scrap Importers & Dealers Association (SAPSIDA). Stakeholders highlighted that wear and tear significantly impact the value of such parts, which are usually acquired at scrap prices in the international market. They cautioned that unjustified increases could harm legal trade and reduce government revenue.

To support the valuation process, 90 days of import data was analyzed, and a market inquiry was conducted under Section 25(7), read with Section 25(9), of the Customs Act. Multiple valuation methods outlined in Section 25 were applied in sequence.

The transaction value method under Section 25(1) was ruled out due to incomplete documentation. Similarly, the identical and similar goods value methods under Sections 25(5) and 25(6) were deemed inapplicable due to inconsistencies and lack of definitive evidence. The final customs values were established through a comprehensive market inquiry, as per Section 25(7) of the Customs Act, 1969.