Traders have expressed resentment over imposition of a new levy by international shipping lines "unilaterally" as Container FED Surcharge (CFEDS) on inbound containerised cargo to recover their expenses under the head of 16 percent federal excise duty (FED) imposed by the government of Pakistan on imported goods on account of services at local ports and terminals in the 2009-10 Budget, Business Recorder reported.
According to traders, the shipping lines for last few days have started charging the importers US$125 per TEU to recover the money they have to pay on account of 16 percent FED.
"They charge it to balance the federal tax on services, but the burden would ultimately be passed on to the trade and would reflect on the cost of doing business," said Nasir Mehmood, a former member of managing committee and chairman of Shipping and Multi-Model Transport Sub-Committee of Karachi Chamber of Commerce and Industry (KCCI).
He claimed that Mediterranean Shipping Company (MSC) had, a few days back, included CFEDS in its shipping bill of an importer. Critical of government''s decision to impose FED on services, the KCCI official said the traders were determined to oppose all such unilateral acts on the part of shipping lines.
While the industry sources confirmed the levying of CFEDS by a "big line" like MSC which follows an independent policy in conducting its shipping affairs, the traders on Saturday approached the Ministry of Ports and Shipping for help.
"We discussed various issues with Secretary, Ports and Shipping, Saleem Khan, but he said the Ministry had no power" to solve traders'' problems, Javed Bilwani, Chairman of Pakistan Hosiery Manufacturers Association (PHMA), told Business Recorder.
According to traders, the shipping lines for last few days have started charging the importers US$125 per TEU to recover the money they have to pay on account of 16 percent FED.
"They charge it to balance the federal tax on services, but the burden would ultimately be passed on to the trade and would reflect on the cost of doing business," said Nasir Mehmood, a former member of managing committee and chairman of Shipping and Multi-Model Transport Sub-Committee of Karachi Chamber of Commerce and Industry (KCCI).
He claimed that Mediterranean Shipping Company (MSC) had, a few days back, included CFEDS in its shipping bill of an importer. Critical of government''s decision to impose FED on services, the KCCI official said the traders were determined to oppose all such unilateral acts on the part of shipping lines.
While the industry sources confirmed the levying of CFEDS by a "big line" like MSC which follows an independent policy in conducting its shipping affairs, the traders on Saturday approached the Ministry of Ports and Shipping for help.
"We discussed various issues with Secretary, Ports and Shipping, Saleem Khan, but he said the Ministry had no power" to solve traders'' problems, Javed Bilwani, Chairman of Pakistan Hosiery Manufacturers Association (PHMA), told Business Recorder.