Customs’ new valuation for Tyres & Tubes, Comparison of ITP (Import Trade Price) Value of Tyres 2021-22

In exercise of the powers conferred under Section 25-A of the Customs Act, 1969, the Directorate General of Customs Valuation, Karachi determined the customs values of various tyres & tubes on 3rd August 2021 for I- Passenger Cars, II- Light Truck & Truck/ Bus, III- Agricultural, Industrial & Earth Mover, IV- Bicycle, Motorcycle, Scooter & Rickshaw etc.

According to Director Customs Valuation Shafique Ahmed Latki, the following methods were adopted to determine Customs Values while this ruling supersedes the valuation ruling No. 1318/2018 dated 30-08-2018.

Valuation methods provided in Section 25 of the Customs Act, 1969 were duly applied in their regular sequential order to arrive at the customs value of subject goods. The Transaction value method as provided in subsection (1) of Section 25 of the Customs Act, 1969, was found inapplicable because no substantial documents were provided by the stakeholders to prove that their declared values were true transactional values. Moreover, different values were declared by different importers for the same product according to different origins.

Identical/ similar goods value methods provided in Sections 25 (5) & (6) ibid were examined for applicability to determine customs values of subject goods. The data provided some references; however, it was found that the same could not be solely relied upon due to the absence of absolute demonstrable evidence of qualities and quantities of commercial level etc. The information available hence was found inappropriate.

In line with the statutory sequential order of section 25, this office conducted market inquiries using deductive value methods under sub-section (7) of Section 25 of the Customs Act, 1969, wide ranges of prices were observed for some items depending upon variety/ quality/ count etc. and location of the market. Hence this method of valuation could not be relied upon due to aforesaid reasons.

Therefore, valuation methods vide Section 25(8) of the Customs Act. 1969, was examined for valuation but the same also could not be applied due to the non-availability of conversion and processing cost of exporting country. Finally, clearance data, market information, the proposal from importers and international prices through the internet were examined thoroughly and the information so gathered were utilized and analyzed for the determination of Custom Values of Tyres and Tubes under Section 25(9) of the Customs Act. 1969.

Customs values for Tyres and Tubes-I (Passenger Cars) - hereinafter specified:

i) If a radial tyre is imported which is not covered in this Ruling and whose specifications are similar to a normal tyre except for being radial, such tyres may be assessed at a 12% higher value than that of the normal tyre.

ii) Values of the tyres with different “ply” shall be assessed by adding or subtracting from the determined value @ 3% per two-ply rating.

iii) Discount of 5% is admissible for the import of tyres and tubes through land route on C&F value determined by this Directorate General.

iv) If tyres and tubes having specifications other than those mentioned in the valuation ruling are imported, the Collectorate may assess the goods under Section 25-A of the Customs Act 1969 or may refer a case to this Directorate General for suitable advice.

Light Truck & Truck/ Bus:

ii) Where only tyres are imported other than tubeless is, depreciation of 6% shall be allotted on Ruling value. Conversely, if the tube of a tyre specified in the ruling is imported, the values shall be assessed at 6% of the tyre value. This is applicable to only those tube sizes which are not mentioned in the valuation ruling.

iii) Values of the tyres with different “ply” shall be assessed by adding or subtracting from the determined value @ 3% per two-ply rating.

iv) Discount of 5% is admissible for the import of tyres and tubes through land route on C&F value determined by this Directorate General.

v) If tyres and tubes having specifications other than those mentioned in the valuation ruling are imported, the Collectorates may assess the goods under Section 25-A of the Customs Act, 1969 or may refer a case to this Directorate General for suitable advice.

Agricultural, Industrial & Earth Mover:

iii) Values of the tyres with different “ply” shall be assessed by adding or subtracting from the determined value @ 3% per two-ply rating.

iv) Discount of 5% is admissible for the import of tyres and tubes through land route on C&F value determined by this Directorate General.

Customs values for Tyres and Tubes-III (Bicycle, Motorcycle, and Rickshaw)

i) Where only tubes are imported, other than specified sizes of two and three-wheeler vehicle tyres, such tubes shall be assessed at 15% of the value of the tyre if imported separately.

ii) Values of the tyres with different “ply” shall be assessed by adding or subtracting from the determined value @ 3% per two-ply rating.

iii) Discount of 5% is admissible for the import of tyres and tubes through land route on C&F value determined by this Directorate General.

iv) If tyres and tubes having specifications other than those mentioned in the valuation ruling are imported, the Collectorates may assess the goods under Section 25-A of the Customs Act, 1969 or may refer a case to this Directorate General for suitable advice.