FBR Revises Customs Values on Import of Old Engines, AC Compressors and More

The Directorate General of Customs Valuation Karachi has issued new customs values on the import of 189 types of old and used auto parts, including engines, gear boxes, AC compressors, and a wide range of other auto parts. In this regard, the directorate has issued a valuation ruling number (1994 of 2025) here on Friday. The new customs values would be applicable on the import of old and used auto parts from all origins. The items shall be assessed as per the determined value; however, the total value of the consignment of old and used auto parts shall not be assessed below US$ 600 per metric ton. According to the ruling, representations were received in this Directorate regarding the redetermination of customs values for Old and Used Auto Parts. Therefore, keeping in view the import data, current market trends, difference in market price, and customs values, an exercise was initiated for the determination of customs values of old and used auto parts under section 25A of the Customs Act 1969. Meetings for the determination of customs values were held that were attended by the relevant stakeholders, i.e., the importers, the local manufacturers, along with the representatives of Old & Used Auto Parts Importers Association, Sindh Auto Parts Scrap Importers & Dealers Association (SAPSIDA). The stakeholders argued that the prices of old and used auto parts depend upon wear and tear. The prices of the used goods of the same make and age vary in the local market due to their efficiency of being used again. Moreover, they stressed that used auto parts are bought on scrap values in the international market. As such, any increase in the customs values thereof shall curtail legal trade and the volume of government revenue therefrom. For this purpose, 90 days’ data of import was also retrieved and the same was scrutinized. Some references to the declared values were available. Subsequently, market inquiry was conducted and examined in the light of this Directorate’s Office Order and in terms of Section 25(7) read with Section 25 (9) of the Customs Act, 1969. The valuation methods specified in Section 25 of the Customs Act, 1969, were duly applied in sequential order to arrive at the Customs values of the subject goods. The transaction value method as provided in subsection (1) of section 25 of the Customs Act, 1969, was found inapplicable due to the absence of information as required under subsection (2) of Section 25 of the Customs Act 1969. Therefore, identical/similar goods value methods provided in Section 25(5) were examined for applicability to determine the customs values of the subject goods. However, it was found that the same could not be solely relied upon due to the absence of absolute demonstrable evidence of quantities and qualities, variation in declaration and specifications. The information available was, hence, found to be incomplete. Subsequently, the similar goods value method provided in Section 25(6) was also examined for applicability to determine the Customs values of the subject goods and was not considered (for application) due to the aforestated reasons. Moreover, the Declared Values (DV) of similar goods showed consistent variations. Hence, this method was also found inapplicable. Market enquiry as envisaged under subsection (7) of Section 25 of the Customs Act, 1969, was conducted. Finally, the Customs values of the subject goods have been determined under Section 25(7) of the Customs Act 1969, the ruling added.