PM Orders FBR to Stop Abusing the Baggage Scheme

The Pakistani government is acting to close a gap in the used car importation process. Prime Minister Shehbaz Sharif has instructed the Federal Board of Revenue (FBR) to impose stricter regulations on secondhand cars imported under the luggage system, which is intended for Pakistanis living abroad.

The mishandling of initiatives such as the "gift scheme," "transfer of residence," and "personnel baggage scheme" is the root of the problem. Under these initiatives, secondhand automobiles can be imported at discounted prices for both returning citizens and recipients of presents from overseas. However some people are taking advantage of these techniques for financial benefit.

The Loophole

This is how the abuse takes place: Under these programs, cars are imported using the passports of Pakistanis living abroad, sometimes without their knowledge or agreement. These vehicles are then quickly sold for a profit in the commercial sector. This not only betrays the true nature of the plan but gives those taking advantage of it an unfair edge.

The government is addressing this problem in several ways:

FBR Scrutiny: Tighter inspections for imported secondhand cars will be carried out by the FBR. This might entail checking travel records, passport information, and that the imported car fits the program's requirements (personal use for a returning resident, for example).

Legislative amendments: To stop companies from abusing Pakistani nationals' passports abroad, the government is investigating potential legislative amendments. This would entail tougher sanctions for passport fraud and more paperwork requirements for businesses importing goods.

Possible Sales Restrictions: One suggestion being discussed is to limit, for a maximum of three years, the local sale of used cars imported under these programs. This would guarantee that the automobiles are utilized for personal purposes and prevent the "buy-to-flip" mindset.

All parties stand to gain from a more robust framework for importing secondhand cars. It guarantees that the program will benefit the intended recipients, who are returning residents and those receiving presents. It also discourages companies from using the system to obtain an unfair advantage over authorized vehicle dealers.

Furthermore, the government can manage any price swings and provide a more stable market environment by regulating the used automobile industry. In the direction of a more open and equitable import system, the government's initiatives to prevent the abuse of used cars are encouraging.

Arifa Hussain

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