Daily Times reported that All Pakistan Motors Dealers Association has demanded of the Federal Board of Revenue to rationalise the import duty on cars so that automobile importers could give healthy competition to local car assemblers. Currently, the overall import duty is 260% while its was 130% in fiscal year 2007-08.
APMDA in its proposals for the budget 2009-2010, which would be sent to the government for consideration, has suggested that the regulatory duty on cars should be abolished. Mr HM Shehzad chairman of APMDA said that the import duty should be rationalised as the locally manufactured cars are high priced and the common man cannot afford them.
Mr Shehzad said that regulatory duty result in revenue loss, which can be verified from Collector Customs, therefore the duty should not be incorporated in the tariff. Overseas Pakistani residents may be allowed to import used cars of not more than 5 years old. Previously 50% rebate was allowed as the maximum benefit at 2% per month was revised to 1% per month. He said that 2% rebate per month should be restored immediately and vehicles up to 5 years old be allowed to be imported.
The local auto industry is facing a tough time due to low demand and high prices of cars. The global economic downturn has left most of the large scale manufacturing industries in trouble and auto industry is one of them. Car sales during first 9MFY09 dropped by 49%, as it stood at 61,185 units as compared to 120,246 units in the same period of 2008. However, industry experts believe that as the macroeconomic indicators are getting better and the economy is on the path of recovery the fiscal year 2009-10 may be better for the auto industry.
