KARACHI, July 4, 2024: Exporters are grappling with significant challenges caused by delays in the approval of the Export Facilitation Scheme (EFS) by the Customs Export Collectorate, Karachi. These delays have resulted in substantial financial losses due to non-approval of EFS and increased demurrage charges. Furthermore, delayed export orders are impacting the reputation of exports abroad.
In response to these issues, exporters have appealed to the Prime Minister and the Finance Minister to address the decline in domestic exports and hold accountable those responsible for the bureaucratic bottlenecks.
The EFS was introduced by the federal government in July 2021, replacing schemes like DTRE, to facilitate duty-free imports of raw materials, engineering goods, and capital goods for sales tax-registered exporters. The scheme categorizes exporters into five categories (A, B1, B2, C1, and C2), with varying export requirements.
To avail the benefits of EFS, exporters must submit detailed documentation including Goods Declaration (GD) details, local purchase invoices, export shipment bookings, and two years’ sales tax returns.
“Despite the government’s provision for online applications, exporters report that the Export Collectorate in Karachi mandates hard copy submissions, complicating the process unnecessarily. Additionally, there are grievances regarding discrepancies in claimed amounts versus approved amounts, requiring multiple bureaucratic stages for resolution.”
Exporters have highlighted that without speed money, files often stagnate, with objections such as audits or factory surveys further delaying the process. In contrast, approvals for other categories or commercial exporters are processed swiftly in some export collectorates, contrasting with the slower pace observed in Karachi.
Unlike other export collectorates, Karachi operates only from Monday to Thursday, with Friday and Saturday designated as holidays. Recent Eid holidays further exacerbated delays, suspending work at the export collectorate for a cumulative 15 days.
Despite previous complaints to the Chairman of the Federal Board of Revenue (FBR) and Member Customs, exporters assert that the situation has not improved. They urgently call upon the Prime Minister and the Finance Minister to investigate and rectify the declining export conditions, emphasizing the need for immediate action to streamline processes and eliminate bureaucratic hurdles.
