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AGP directs FBR & MoC to remove duplicate tariff lines from FTAs

AGP directs FBR & MoC to remove duplicate tariff lines from FTAs

ISLAMABAD: Auditor-General of Pakistan (AGP) has recommended that Ministry of Commerce (MoC) and Federal Board of Revenue (FBR) to take measures for immediate removal of duplicate, triplicates, and quadruplicate tariff lines from the free trade agreements.

Directorate finds that selection of tariff lines is not in line with strength of local industry and consumption habit of society, and Free Trade Agreements promoted habits of the tax evasion in the society. According to report, Directorate General of Audit, Customs and Petroleum, conducted an audit of “Import under Free Trade Agreements” covering the imports exports.

The main objectives of the audit were to analyze the role of ministry of commerce in framing the rules, analyze the role of Federal Board of Revenue in implementation of agreements with China, Malaysia, and Sri Lanka, analzse the impact on imports and export patterns, and to analyze the impact of Free Trade Agreements and Balance of Trade on Tax to Gross Domestic Production ratio.

Auditor General has recommended that Ministry of Commerce should review China Pakistan Free Trade Agreement for second phase and all the free trade agreements must be reviewed for consistency. It is also recommended that ministry of commerce and federal board of revenue should take concrete steps for inclusion of tariff lines which benefited the local industry and general public, and supervision of imports under free trade agreements must be increased to avoid misuse of provisions of agreements and safeguard revenue. It is also suggested that federal board of revenue should withdraw the delegation of powers from customs staff.