Pakistan Lowers Customs Duty on Solar Panels – 2025 Update

In a significant move aimed at aligning import duties with global market trends, the Directorate General of Customs Valuation, Karachi, has issued a fresh valuation ruling, reducing customs values on imported solar panels to between US$0.09 and US$0.08 per Watt, regardless of their country of origin.

This update comes via Valuation Ruling No. 2012/2025, issued on Monday, following widespread concerns raised by stakeholders regarding outdated customs values in light of a steady decline in international solar panel prices.

Industry Appeals Trigger Re-Evaluation

The reassessment process was set in motion after multiple stakeholders, including the Pakistan Solar Association (PSA), submitted formal requests highlighting a substantial drop in global prices. In its letter dated January 21, 2025, PSA specifically requested a review of the older Valuation Ruling No. 1894/2024 (dated July 4, 2024), citing discrepancies between current market values and previously assessed customs values.

An initial consultative meeting was held on February 19, 2025, where importers and solar sector representatives collectively supported the continuation of the tier-wise valuation system but unanimously called for revised, lower customs values to reflect international market realities.

Banking Challenges and Clearance Delays

During discussions, importers pointed out serious operational hurdles caused by the outdated customs values. Due to the gap between declared transaction values and higher assessed customs rates, banks were reluctant to process documentation, leading to significant delays in consignment clearance.

Stakeholders stressed that aligning valuation rates with real market conditions was essential to ensure smoother banking compliance and supply chain efficiency. They also suggested that customs authorities conduct local market verifications and engage with distributors and exhibitors at solar tech expos to gather updated price data.

Setbacks and Further Deliberation

Notably, several major importers were unable to attend the initial session as they were participating in a long-running international solar technology exhibition in China. Additionally, internal departmental transfers further delayed the revaluation process.

However, in a follow-up meeting, attending participants reiterated the need for a downward revision, presenting extensive supporting documents — including commercial invoices, Goods Declarations (GDs), and transaction evidence — to justify their claims. Clearance records from the past 90 days were also examined to ensure fair and data-backed decision-making.

Legal Basis for Customs Value Revision

The Directorate undertook the re-determination exercise under the provisions of Section 25 of the Customs Act, 1969. Although the primary valuation method based on actual transaction value (Sub-section 1) was deemed inapplicable due to insufficient data under Sub-section 2, alternate methods were thoroughly explored.

• The Identical Goods Method (Section 25(5)) offered partial insights but lacked complete data on quality and quantity for full reliance.

• The Similar Goods Method (Section 25(6)) proved more suitable, using recent import data to estimate fair customs values.

Based on the findings, the revised customs values were finalized and notified under Section 25A, ensuring that import assessments are now more aligned with current international price benchmarks.

Key Highlights:

• New customs valuation set between US$0.08 and US$0.09 per Watt.

• Re-evaluation initiated after PSA request and market evidence.

• Importers faced delays due to bank rejections caused by outdated customs values.

• Legal valuation based on Section 25 of the Customs Act, 1969.