Customs Depart set to revise reference price

THE Department of Customs (DoC) is working on to hike the valuation (reference price) of some 3,000 imported goods in line with the increased price of such goods in the international market. The DoC fixes reference prices of good imported to discourage huge undervaluation of goods to pay low customs duty. Once the new reference price comes into force, the importers regardless of the purchase price of the goods will have to pay the duty as per the reference price determined by the customs office. The customs offices may purchase the goods by paying the price as per the bills in the event of discrepancies. However, the customs offices usually clear the customs of imported goods based on the transaction value as mentioned in the bill. Officials said the products, including textiles and garments, shœs, motor parts, plastic materials and electronic items are on the list of items whose valuation could be raised. A meeting of chiefs of different Customs Offices across the country on August 24-26 had stressed on the need for revising the reference price of a large number of items, said Damodar Regmi, deputy director general at the DoC. “The department is currently preparing a detailed report with regards to the name and status of the items whose reference prices have to be revised,” he said. The reference price of the items will be raised by an estimated 15-20 percent. The revision in the reference price works as an alternative information in the event of undervaluation of imports. It also helps customs offices maintain uniformity in the valuation of goods. “We have been preparing to increase the valuation of some items on the basis of growing complaints of tax evasion through under invoicing,” said a high level official at the department. Regmi also said the recommended names for revision of the reference price are among those which have been receiving complaints of higher under valuation. “The revision in customs valuation will not only help control the undervaluation but also help to minimize the discrepancy between the customs declared price and market price,” he added. The department had directed customs offices across the country to send the list of items for revision at the beginning of the new fiscal year. “Having received suggestions from the customs offices, we are now sorting out the items,” said Regmi, adding that the final list of the items will be prepared within this week. He said the reference price would be revised for imported items both from India and other countries. After finalising the list, the DoC will give around two weeks for local imports (imports from India and China without opening letters of credit) to comply with the new valuation. Importers of goods from third countries will get three weeks to comply with the revised reference price.