Pakistan Association of Automotive Parts and Accessories Manufacturers asks Govt to prosecute car smugglers

Lahore, November 05, 2012 (PPI-OT): The Chairman of Pakistan Association of Automotive Parts and Accessories Manufacturers (PAAPAM), Munir Bana, lauded FBR’s plan to launch a national drive against non-duty paid smuggled vehicles. However, he asked the authorities to also prosecute the car smugglers under the law of the land and give them stiff jail sentences, as simple levy of fines and penalties has never proved to be a deterrent.

“Smugglers use engine numbers of imported used cars for registration of smuggled vehicles as there is no system for verifying their authenticity. Engine numbers of locally assembled cars can be verified from the assemblers’ records,” observed PAAPAM Chairman Munir Bana.

He said that the customs intelligence had collected data of 2.3 million non-duty paid smuggled vehicles, which is just 15 percent of an estimated 14 million smuggled/non-registered vehicles all over the country.

The government, instead of taking preventive measures to check these smuggled vehicles, introduces amnesty schemes from time to time, thereby encouraging smugglers to continue their criminal activities.

Similarly, expressing his dismay at the ever-shrinking list of honest taxpayers in all sectors, Mr Bana said that amnesty schemes should not be used as a measure to raise revenues, as these discourage honest taxpayers and create distrust in state institutions.

The PAAPAM Chairman sincerely believes that tax amnesty and money-whitening schemes for smugglers of vehicles are acts of betrayal, cheating the auto industry, who are fully documented and also amongst the highest and most honest taxpayers. “We want to remind the government of its solemn promise made to the Parliament in 2008 that after Tax Investment Scheme it would not introduce any more amnesty schemes.”

He said that tax amnesty scheme protects tax evaders as they whiten their untaxed money simply by paying a small premium to money changers for arranging remittance in their names.

Moreover, smugglers of vehicles are the main beneficiary of such schemes, as majority of luxury cars are cleared by paying nominal fee under these schemes, and damaging the local auto sector, which provides direct/indirect employment to 1.8 million persons.

All amnesty schemes have been abused cleverly by Pakistani tax dodgers to launder their untaxed money through state patronage, he added. He said that under all the tax amnesty schemes govt failed to collect even a fraction of the black money.

How the FBR can ignore a serious crime like smuggling simply by collecting penalties, asked PAAPAM Vice Chairman Usman Malik. He said that parliament instead of entertaining an amnesty scheme should seriously consider introducing ‘Asset-seizure Scheme’ to confiscate untaxed assets as well as non-duty paid costly vehicles purchased from undisclosed money.

He said the amnesty schemes introduced by the FBR in the past failed to yield positive results. A scheme was launched during the Musharraf regime in 2000-01, and the FBR collected only Rs10 billion. Another scheme which was launched in 2008 fetched just Rs2.5 billion.

He added that there is no bar to issue notices, under sections 114 and 116 of the Income Tax Ordinance, to tax dodgers and smugglers, putting their assets including smuggled vehicles on auction for recovery of tax, besides prosecuting and putting them behind bars.

For more information, Contact:
Syed Nabeel Hashmi
Pakistan Association of Automotive Parts and Accessories Manufacturers (PAAPAM)
16-B, Westwood Colony, Thokar Niaz Baig, Lahore.
Tel # +92 42 37498474-5
Fax #+92 42 37498476
Cell: +92 333 4372500
E-mail: ;

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