New Charges on Oil Derivatives [Archives:2001/49/Local News]

December 3 2001

The Customs Authority submitted within the last couple of days a draft law to the government to add car’s customs on oil derivatives. The draft law is aimed at putting an end to the issue of smuggling cars and other goods including small and expensive goods. A source at the Custom Authority considered car and truck smuggling as a dangerous multidimensional phenomenon, adding that the widespread reach of this phenomenon is principally ascribable to the very long sea and land boundaries of the Republic of Yemen, as well as to the existence of free market zones in neighboring countries. The high customs levied by the government is undoubtedly a contributory factor to the spread of this phenomenon. The source added that the few times the government has seized smuggled products it has been forced to compensate for them from public funds.
The source noted that the reason behind presenting this draft law to the government is the loss of substantial parts of customs, particularly the customs registration fees. On the other hand, the importation of secondhand cars in a drive to avoid high taxes has incurred stubborn problems for the environment and economy.
Regarding the security reasons involved in presenting this draft law, the source said that smuggling cars and different vehicles without registering them makes these vehicles a means of committing different crimes and also makes it difficult to track down and to identify their perpetrators. The submission of this law to the government comes after many government bodies, such as the Supreme Committee for Fighting Smuggling and its affiliate committees, have failed to effectively tackle this issue.
Similarly, the drastic reduction of customs on smuggled cars and the high customs levied at Yemeni ports constitutes an incentive for smuggling. The source stressed that the best way to solve the issue of smuggling is to put an end to the irregularities at the related authorities, as well as to find other efficient means and mechanisms for implementing the different policies pertaining to this issue. The source also recommended the removal of all customs and taxes as the best measure to take to solve the problem of smuggling, and instead of these customs and taxes the government should impose charges on oil and diesel. The draft law includes a number of alternatives for handling this issue, such as adding an extra three, four or five riyals per liter in addition to the registration fees.