Pak: Audit uncovers massive under-invoicing, money laundering in luxury car imports

Islamabad [Pakistan], August 6 (ANI): The Post Clearance Audit (PCA) of the Directorate General of Customs has revealed extensive under-invoicing and money laundering schemes in the customs clearance of luxury vehicles via the faceless system.

As reported by The Express Tribune, a detailed 127-page audit report has exposed what is being termed the largest trade-based money laundering scandal in Pakistan's history related to luxury vehicle imports.

The report indicates that importers intentionally undervalued their vehicles to evade payment of billions in taxes. One of the most shocking incidents noted in the report involved a 2023 model Toyota Land Cruiser, which had a market price exceeding Pakistani Rupees (PKR) 10 million, yet it was cleared through customs at a remarkably low declared value of just PKR 17,635, allegedly with the help of customs officials.

The audit encompassed the timeframe from December 2024 to March 2025, examining the post-clearance data of 1,335 imported vehicles. It identified major inconsistencies between the stated and assessed values, with variances surpassing PKR 1 million for numerous vehicles. Importers reported the total import value of these vehicles as PKR 670 million, while the actual assessment revealed it to exceed PKR 7.25 billion.

Through this manipulation, importers only remitted PKR 1.29 billion in duties and taxes, successfully evading an estimated PKR 18.78 billion in customs duties and taxes. In line with the PCA report, no importer could provide evidence that payments for the vehicles were made through legitimate channels from overseas. This led to strong suspicions that the payments were facilitated via illegal hawala and hundi networks, according to The Express Tribune.

Furthermore, the report disclosed that an overwhelming 99.8 per cent of all Land Cruiser vehicles imported during the audit period were cleared through under-invoicing to dodge taxes and duties. It cautioned that such organised under-invoicing not only results in significant tax evasion but also poses serious risks to Pakistan's financial system, as revealed by The Express Tribune.

The audit report has been sent to the Federal Board of Revenue (FBR), the State Bank of Pakistan, and the Financial Monitoring Unit (FMU) for a comprehensive investigation and legal steps against the involved network in this financial misconduct. (ANI)

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