Complete details of amendments made to Customs Act through Finance Bill 2023

Islamabad, June 9, 2023: Finance Bill, 2023 has proposed amendments to Customs Act, 1969, according to Pakistan Budget 2022-23 released on Friday.

Following is the text of complete proposals made through Finance Bill, 2023:

Clause 3(1) Seeks to amend section 2 (s) to enable Pakistan Customs to conduct anti-smuggling operations within municipal limits.

READ MORE: Pakistan Budget 2023-24 At A Glance

Clause 3(2) Seeks to amend section 3C of the Customs Act, 1969 to replace the name of Pakistan Customs Academy (PCA) with Customs Academy of Pakistan (CAP) to avoid duplication in nomenclature.

Clause 3(3) Seeks to amend section 7 of the Customs Act, 1969 to include Provincial Levies and Khasadar Force in the list of departments which are bound to provide assistance to Customs whenever requested.

Clause 3(4)(a) Seeks to amend section 19(1) to help implement agreements of Government of Pakistan with an entity.

Clause 3(4)(b) Seeks to amend 19(5) to give continuity to the notifications issued under section 19 during the financial year.

Clause 3(5) Seeks to amend section 25A to consult and not incorporate straightaway internationally acclaimed publications, periodicals, bulletins etc. to determine truth, and accuracy of the declared values. With the proposed amendment, the proviso to Section 25-A of the Customs Act, 1969 shall be harmonious with Section 25, 25-A and the WTO Valuation Agreement.

READ MORE: Finance Bill 2023 – Customs Duty Salient Feature

Clause 3(6) Seeks to amend section 79 to legally bind the owner of goods to file GDs within three days after arrival of goods at border Custom stations to ease out congestion.

Clause 3(7) Seeks to amend section 98 to enhance the warehousing period for perishable items to facilitate the trade.

Clause 3(8) Seeks to amend sub-section (1) of section 139 to facilitate the passengers travelling as a group who cannot file their own declarations, by allowing the representative to file baggage declaration on behalf of the group members.

Clause 3(9)(a) Seeks to amend S.No.1 of the Table of section 156(1) to rationalize the pitch of penalty for the offense of (a)invoice and packing list not found inside the container, and (b) invoice and packing list not uploaded electronically with the GD, with a view to redress the grievances of the trade. The National Assembly Standing Committee on Finance also observed that the current penalties are very harsh for the trade.

Clause 3(9)(b) Seeks to amend S.No.8 of the Table of section 156(1) to make penal provisions more stringent in relation to smuggling of essential commodities.

READ MORE: Finance Bill 2023 – Sales Tax Salient Features

Clause 3(9)(c) Seeks to amend S.No.9 of the Table of section 156(1) to make penal provisions more stringent in relation to the goods imported or exported in contravention of the restrictions imposed thereon.

Clause 3(9)(d) Seeks to amend S.No.89 of the Table of section 156(1) to make penal provisions more stringent in relation to smuggling of goods as defined in section 2(s).

Clause 3(9)(e) Seeks to amend S.No.90 of the Table of section 156(1) to make penal provisions more stringent in relation to evasion of duty / taxes and breach of prohibitions or restrictions.

Clause 3(10) Seeks to add proviso to section 179(2) to provide option to the respondent to go for adjudication through Customs Computerized System with a view to reduce the clearance time and eliminate human interaction.

Clause 3(11) Seeks to amend section 182 to enable Pakistan Customs to utilize the confiscated conveyance and any other useful equipment for anti-smuggling operations.

Clause 3(12) Seeks to amend section 185D to ensure merit in the investigation of criminal cases.

Clause 3(13) Seeks to insert a new clause in section 194A (1) to align it with Chapter 10 of the revised Kyoto Convention of WCO.

Clause 3(14) Seeks to insert a proviso in section 208 to allow self-filing of GD to the compliant tax payers.

Clause 3(15) Seeks to omit clause (iii) of sub section (2) of section 212B as interpretation of any statute concerning leviability in respect of ongoing transactions which otherwise lies in the domain of FBR, falls outside the purview of Advance Ruling.

Clause 3(16) Seeks to amend First Schedule to the Customs Act, 1969 with the First Schedule to this Act.

READ MORE: Finance Bill 2023 – Income Tax Salient Features

Clause 3(17)(A)(i) Seeks to amend in serial 21 of Part-I of Fifth Schedule to exempt customs duties on import of machinery, equipment and inputs for manufacturing of solar panels, inverters and batteries.

Clause 3(17)(A)(ii) Seeks to amend serial 26 of Part-I of Fifth Schedule to extend the date of duty free imports of plant, machinery and equipment for setting up of industries in erstwhile FATA Areas till 30th June, 2024.

Clause 3(17)(B)(i)(a)&(b) Seeks to amend Table-A, Part-II of Fifth Schedule to delete 01 Active Pharmaceutical Ingredients (APIs) and included 01 another API in the existing list of exemption regime.

Clause 3(17)(B)(ii) Seeks to amend Table-C, Part-II of Fifth Schedule to include 03 medicines in the existing list of exemption regime.

Clause 3(17)(B)(iii) Seeks to amend Table-D, Part-II of Fifth Schedule to include 01 raw materials for Pharma packing in existing list of concessionary regime.

Clause 3(17)(C)(i) Seeks to insert new serial number 9A, to exempt customs duties on import of seeds for sowing.

Clause 3(17)(C)(ii) Seeks to delete serial numbers 44, 56, 63 and 88 in Part-III, of Fifth Schedule to remove duplication and streamline the concession / exemption on raw material / inputs for diaper / sanitary napkins.

Clause 3(17)(C)(iii) Seeks to amend serial number 107 of Part-III of Fifth Schedule to include specific papers for printing of Holy Quran.

Clause 3(17)(C)(iv) Seeks to amend serial No. 111 of Part-III, of Fifth Schedule to streamline the concession / exemption on raw material / inputs for diaper / sanitary napkins.

Clause 3(17)(C)(v) Seeks to amend serial No. 113 of Part-III, of Fifth Schedule to rectify the exemption on raw materials / inputs for hemodialyzers fluid/powder.

Clause 3(17)(C)(vi) Seeks to amend serial No. 119 of Part-III, of Fifth Schedule to exempt customs duties on import of Organic composite solvents and thinners for manufacturers of Butyl Acetate and Dibutyl Orthophthalates.

Clause 3(17)(C)(vii) Seeks to amend serial No. 122 of Part-III, of Fifth Schedule to include one more input "roasted peanuts" in the existing list of inputs used in the production Ready to Use Supplementary Foods (RUSF).

Clause 3(17)(C)(viii) Seeks to amend serial No. 134 of Part-III, of Fifth Schedule to allow import of PET Scrap on reduced rate for the manufactures of Polyester Filament Yarn.

Clause 3(17)(C)(ix) Seeks to amend serial No. 151 of Part-III, of Fifth Schedule to extend concession of customs duty on import of Flavouring powders for food preparation.

Clause 3(17)(C)(x) Seeks to add new serial No.153 to 159 in Part-III, of Fifth Schedule to exempt customs duties on import of raw materials / inputs for manufacturers of Adhesive Tap, Capacitors, Moulds and Dies, Mining machinery, Machine Tools and Rice mill machinery and imports by the exporters of IT and IT enabled services.

Clause 3(17)(D) Seeks to delete the Part-V of Fifth Schedule to align the Auto Industry Development and Export Policy (AIDEP) 2021-26

Clause 3(17)(E)(i)(ii)&(iii) Seeks to amend Table-II of Part-V(A) to rectify the PCT codes of electric motors.

Clause 3(17)(F) Seeks to substitute the Part-V(B) of Fifth Schedule to align the Auto Industry Development and Export Policy (AIDEP) 2021-26

Clause 3(17)(G) Seeks to amend serial No. 2 of Table-A, of Part-VII, to include live baby shrimp/prawns/juvenile in the existing exemption regime for production and breeding. Scope of exemption also extended for hatcheries.

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