Customs warns of rice subsidy abuse

ISLAMABAD: Pakistan Customs has identified approximately 150 exporters engaged in widespread misdeclaration of the weight of rice consignments, which could enable them to claim inflated subsidies.

The Collectorate of Customs (Exports), Karachi, has held a meeting with the Rice Exporters Association of Pakistan (REAP) to address what they described as a recurring compliance failure among exporters in availing the subsidy on rice exports.

Well-placed sources told Dawn on Tuesday that the customs authorities have raised the alarm over the growing misuse of export facilitation mechanisms after detecting widespread misdeclaration of weight in rice export consignments.

As per the details, multiple consignments were found carrying discrepancies between declared and actual weights. The issue was serious enough for customs officials to convene a formal meeting with members of the REAP to address the issue.

Identifies 150 exporters misdeclaring weights

Identifies 150 exporters misdeclaring weights

The Ministry of Commerce has allocated approximately Rs15 billion for a rebate scheme on local taxes and levies for rice exporters. Exporters of basmati and brown rice are eligible for a 9 per cent rebate on the FOB value, provided the export price is at or above $750 per tonne.

Other coarse rice qualifies for a lower rebate of 3pc of FOB value, but only where the export price remains below $750 per tonne.

According to officials familiar with the discussions, misdeclaration of weight allows exporters to exaggerate shipment volumes in........

© Dawn Business