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FBR Slaps 30% Customs Duty on Import of Electric Sightseeing Bus

The Federal Board of Revenue (FBR) has imposed 30 percent customs duty on the import of electric vehicle (14 Seater Electric Sightseeing Bus).

The FBR’s Customs Classification Committee has also ruled that the said imported electric vehicle would not be subjected to 20 percent duty under PCT heading (8702.4090).

In this regard, the Customs Classification Committee has issued a ruling. According to the committee, the Committee is of the view that the subject “Electric Vehicle (14 Seater Electric Sightseeing Bus)” is classifiable under Pakistan Customs Tariff (PCT) headings 8703.1000. The PCT heading covers vehicles specially designed for traveling on snow, golf cars and similar vehicles.

The Collectorate of Customs Appraisement Port Muhammad Bin Qasim Karachi forwarded a reference for determination of actual description / classification of ‘Electric Vehicle’ imported.

Brief facts of the case are that a company imported a consignment declared to contain “14 Seat Electric Co Sightseeing Bus” under PCT heading 8702.4090 attracting customs duty @ 20%. The importer claimed reduced rate of customs duty @1% under Serial No.4 of Part V(A) of the 5th Schedule to the Customs Act, 1969. This provision of exemption allows reduced rates of customs duty for 2-3 Wheelers, 4-Wheelers and Heavy Commercial Vehicles (CBUs) including “electric buses” in CBU condition classifiable under heading 8702.4090.

The referring Collectorate was of the view that the imported vehicles though operated on electric power and used for transportation of more than ten persons correctly fall under the definition of “carts/golf carts”. While the term “electric buses” used in the exemption is limited to the those “electric buses” which are “heavy commercial vehicles used as public transport and/or are usually meant for travelling of “passengers” from one to another for relatively long distances or intercity movements of passengers. Therefore, while treating the goods as “electric carts” and not the “electric buses” the claimed exemption was regretted.

The committee concluded that the 14-seater Electric Sightseeing Bus, while operating on electric power, is principally designed for transporting passengers for short distances within specific locations such as airports, shopping malls, and tourist attractions.

The committee emphasized that the vehicle’s operation and purpose are similar to golf carts and other similar vehicles typically classified under PCT heading 8703.1000. These vehicles are meant for transportation within limited areas over very short distances, and the committee noted the 14-seater Electric Sightseeing Bus falls under this category, committee added.

  • They should have reduced import duty on e-vehicles so much so that the price of e-cars and petrol cars become equal or only a mere difference of 1 lakh. People would prefer e-vehicles and we would save 10 billion dollars on petrol import bill.

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