All tariff rationalisation requests to be routed through TPB first

MUSHTAQ GHUMMAN

ISLAMABAD: The government has decided that all tariff rationalisation requests will first be presented before the Tariff Policy Board (TPB), headed by the commerce minister. However, if the industry remains dissatisfied with the TPB’s decisions, such cases will be referred to the Steering Committee, led by the finance minister, for further deliberation and a final decision, well-informed sources told Business Recorder.

According to the Joint Secretary (Tariff Policy), following the prime minister’s directives to examine sector-wise and item-wise tariff proposals of the working group on customs and trade tariffs, a sub-committee was constituted under the minister of state for finance and revenue. The sub-committee was tasked with identifying products that witnessed a 20–30 percent increase in import volumes due to tariff rationalisation measures under the National Tariff Policy (NTP) 2025–30.

The sub-committee held several meetings and further constituted a smaller working group to conduct a sector-wise assessment of tariff reforms in the Soda Ash and Polyester Staple Fibre (PSF) sectors.

The minister of state for finance noted that both upstream and downstream industries were consulted during stakeholder engagements. The analysis revealed that, in the case of Soda Ash, anti-dumping duties have already been imposed on imports from Turkey and Kenya. For imports from China, it was concluded that the domestic industry may file a separate anti-dumping application with the National Tariff Commission (NTC), if deemed necessary.

In the case of PSF, it was determined that the decline in industry competitiveness is not linked to changes in the tariff structure. However, the industry may approach the NTC for appropriate trade remedies, if required.

The senior technical advisor on commerce, a member of the sub-committee, stated that stakeholders could approach the committee to have their grievances addressed. The SAPM on Petroleum reiterated that all tariff rationalisation requests must first be placed before the TPB. If the industry is not satisfied with the TPB’s decision, the matter can then be forwarded to the Steering Committee through the sub-committee.

The Steering Committee decided that the prime minister’s assigned task may be considered complete, as the concerns raised by industries have been addressed. It was further decided that all future tariff rationalisation requests will follow the same process with initial review by the TPB, followed by referral to the Steering Committee if required.

Regarding tariff rationalisation for the latex rubber industry, the Joint Secretary (Tariff Policy) stated that in FY2025–26, tariff protection on latex rubber thread (HS Codes 4007.0010 and 4007.0090) was reduced from 20 percent to 17 percent. Under the China-Pakistan Free Trade Agreement (CPFTA), the product currently attracts a 12 percent customs duty, which is expected to decline to 8 percent in the coming years.

The industry has requested an increase in tariff protection and removal of these items from CPFTA. However, the commerce ministry maintained that this is not a case of reverse cascading, as most, raw materials used in latex rubber thread production are already subject to zero percent import duty. Therefore, the request to remove the product from CPFTA cannot be entertained.

The Steering Committee endorsed this view, stating that the case does not qualify as reverse cascading. It advised the aggrieved industry to approach the NTC for relief under trade remedy laws, while reiterating that the request for removal of latex rubber thread from CPFTA cannot be accepted.