Islamabad: The federal government has decided to withdraw its suggestion to impose regulatory duties of up to 100 percent on luxury goods and used vehicles following objections raised by members of the European Union (EU).
This week, the federal government proposed the Tariff Policy Board to consider imposing additional regulatory duties on 125 luxury items. However, the Tariff Board did not endorse the government’s proposal and deferred the matter.
It is worth noting that six months ago, the government completely eliminated regulatory duties on vehicles with engine capacities up to 1800 cc and also reduced import duties on new vehicles, mobile phones, and various other products.
Sources have informed Express that the proposal aimed to impose regulatory duties solely on imported goods that could lead to foreign exchange savings. The suggestion was to double the duties on items with low duties and to raise duties by 30 to 50 percent on items with already high import duties. This list encompassed 104 items for which increased duties were proposed, along with an additional 20 new items to be included.
The tax administration estimates that implementing the new duties could save the country $400 million in foreign exchange. However, the Tariff Board did not endorse these proposals, fearing that they might jeopardize negotiations between Pakistan and the European Union regarding the Generalized System of Preferences Plus (GSP Plus).