Haroon ur Rasheed
The period of customs duty exemption in the Malakand Division has come to a close. However, customs officials are currently unable to impound non-customs-paid (NCP) vehicles, citing a lack of manpower and resources as the primary reasons.
Despite regulations calling for the impoundment of NCP vehicles following the expiration of the tax exemption period, the customs department is constrained due to the absence of essential infrastructure, human resources, and other vital assets.
According to a senior official, Customs does not have a presence in Malakand Division, an area known for having a significant number of NCP vehicles. Although impounding these vehicles was planned, the current circumstances do not permit it. The official noted that it might happen eventually but not in the near future.
Recalling the government’s decision in 2018 to allow duty-free vehicles to operate for five years, this grace period ended on June 30, 2023. However, the previous government, under the Pakistan Democratic Movement (PDM), extended the exemption from sales and income tax in the former FATA and PATA regions for an additional year, until June 2024.
Local residents have voiced concerns about the potential confiscation of NCP vehicles, but officials clarified that the extension pertains only to sales and income tax and does not affect customs duty.
The region has approximately 0.4 million NCP vehicles, with a majority located in Malakand Division. For over 90% of the division’s residents, these vehicles are their primary means of transportation and source of income.
Customs Enforcement Collector Khawaja Khurram confirmed that most NCP vehicles are in the Malakand Division. He emphasized that the extension of customs duty exemption has not been discussed. A collective decision will be made by all stakeholders before the Customs Department can proceed with any action.
Malakand Commissioner Saqib Raza Aslam expressed the need for resolution and clarified that the exemption’s extension solely pertains to sales tax and income tax, not customs duty. The federal government’s decision will be implemented accordingly.