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Govt urged to take action against investors for importing used cars illegally

Govt urged to take action against investors for importing used cars illegally

LAHORE: Pakistan Automotive Manufacturers Association (PAMA) Director General Abdul Waheed and Pakistan Association of Automotive Parts Accessories Manufacturers (PAAPAM) Chairman Usman Malik have alleged that the importers of used cars are involved in illegal activities and urged the government to hold them accountable for violating the constitution of Pakistan.

In a joint statement, both the traders’ leaders said that the used cars importers forge documents to import used cars, evade taxes, sell old junk cars at prices equal to locally produced new cars to the customer, and do many gimmickries to harm the national interest.

PAMA Director General Abdul Waheed emphasised that it is high time the government should take action against this dealer mafia as they are doing a hefty damage to the employment base of the country through the import of thousands of used cars and help the national economy by patronising local industry.

Abdul Waheed said that on one hand the GoP is promoting import of fuel efficient Hybrid vehicles as an alternative to CNG fuelled vehicles by giving substantial relief in Duty & Taxes and on other hand it continues to allow imports of up to 5 year old high end SUVs with very high fuel consumption for which they are considered as gas guzzlers. They also do not pay full import duty as law allows depreciation allowance of up to 50%, a concession which makes these luxury vehicles affordable for ruling elites and landlords of this country – who are usually the buyers.

PAAPAM Chairman Usman Malik said that the local auto industry is doing this big favour to the government and society despite facing many hardships and at a time reaching crisis points due to abrupt changes in the approaches and implementation of the bad policies by the government.

“It is encouraging that Customs Department is not allowing the import of used cars on forged documents to stop the illegal activities of the dealer mafia which is boding well for the local auto industry as it resulted in reduction of used cars import and this should be carried on,” he added.

Usman stated that PAAPAM has repeatedly requested the government to rescind or at least review fixed duty & taxes rates in SRO 577, but still PAAPAM’s voice is unheard.

The rates fixed in US$ term in SRO 577 back in year 2005 are very low, thus giving an undue advantage to used car traders at the cost of local industry and resulting in significant loss of revenue to the Government that ranges from USD 4475 to 7337 on import of used cars.