Islamabad, July 23, 2025: In a move that could impact the local construction and import sectors, the Directorate General of Customs Valuation Karachi has issued a revised valuation ruling for imported porcelain and ceramic tiles.
The new customs values apply to over 30 different tile categories, including polished porcelain tiles, glazed and matt finish tiles, as well as decorative skirting and borders.
The updated rates were formalized through Valuation Ruling No. 2011/2025, following a review under the Customs Act 1969. This revision comes after Ruling No. 1972/2025 was contested and remanded for reevaluation under Section 25-A and 25-D, requiring the Directorate to reconsider its earlier assessments.
Key Updates in Customs Valuation
The revised customs values reflect a fresh market analysis involving consultations with importers and local tile manufacturers. Notably, concerns were raised about grouping tiles from the UAE, Turkey, and Iran under a single “other” origin category—often resulting in valuations similar to lower-priced Chinese imports.
Importers argued that technological improvements have led to a global drop in tile prices and emphasized the need to prevent undervaluation or misdeclaration. They also challenged the assumption that tile prices increase with size, stating that the current method lacks transparency and stakeholder engagement.
In contrast, local manufacturers insisted that larger tiles entail higher production costs and should be valued accordingly. They called for a separate valuation mechanism for different origins to reflect market realities and to protect the domestic industry, which has invested heavily in manufacturing infrastructure.
Stakeholder Participation and Missing Documents
Several consultative meetings were held between May and June 2025 to gather input and documents from stakeholders. While some importers, including representatives from RAK Ceramics UAE, were asked to provide sales tax data and Annexure-C forms, they failed to submit complete records, weakening their position during the review.
Despite these setbacks, the Directorate confirmed that manufacturers’ viewpoints were acknowledged in the final ruling. A thorough market study was also proposed to verify the actual retail prices of imported tiles in Pakistan, especially amid claims of pricing disparities.
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Implications for the Tile Industry in Pakistan
This valuation adjustment is expected to influence the import cost of ceramic and porcelain tiles significantly, possibly leading to higher customs duties on premium non-Chinese brands. It also underscores the Federal Board of Revenue’s intent to tighten controls on trade classification and combat revenue leakage through undervaluation.
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The tile import sector in Pakistan remains a highly competitive space, and this move is seen as a balancing act between protecting local manufacturers and maintaining fair pricing for importers.
