New items not included in the scope of China-Pakistan FTA: FBR

Islamabad: Pakistan’s Federation Board of Revenue (FBR) has clarified that no new item has been included in the scope of China-Pakistan Free Trade Agreement (CPFTA).

The FBR said that the revision of SRO.1640(I)/2019 relating to CPFTA did not extend the list of items allowing concessionary rate of customs duty or zero percent duty on the import of items from China.

It is pertinent to mention that all the amendments introduced vide SRO.1181(I)/2022 in the aforementioned China-Pakistan FTA related Statutory Regulatory Orders (SRO) are only the classification related changes which are the result of tariff transposition exercise conducted to incorporate the amendments introduced by World Customs Organization (WCO) through Harmonized System HS- 2022 version, the FBR explained in a statement.

“It is important to share that Pakistan Customs Tariff (PCT) is basically based on the “Harmonized System (HS)”, a multipurpose goods nomenclature developed by WCO,” it added.

The FBR elaborated that the Harmonized system was normally amended by WCO once in every five years to accommodate the important scientific, technological and other trade patterns related changes emerging at the international trade horizon from time to time. All the WCO’s member countries including Pakistan are bound to transpose/incorporate these HS amendments in their respective country tariffs.

The transposition exercise always resulted into numerous structural changes in tariff lines owing to splitting, merging and deletion of numerous tariff lines, the FBR stated.

Recently, it the FBR maintained, “WCO has introduced amendments in Harmonized System through HS-2022 version and these changes have been effective at international level since 1st January, 2022. As multiple statutory documents including Import/Export Policy Orders, SROs pertaining to Free /Preferential Trade Agreements (FTAs/PTAs) are based on HS codes, therefore, consequential alignment of these SROs as per new version of HS nomenclature has also been performed accordingly.”