India, Pakistan Levy Seaport Charges

Beginning in July, seaports in India will charge a 5% service tax as part of a government effort to broaden the tax base and raise revenue. Traders were generally accepting of the tax, considering the government has strived to improve port operations in recent years to meet capacity demands. Furthermore, the government has announced tax incentives, mostly in the form of tax holidays, designed to attract private investment to infrastructure projects, including ports and roads. Meanwhile, shipping companies in Pakistan are angry over new container charges at the state owned Port of Karachi, which they claim are illegal. The All Pakistan Shipping Association said the $15.70 charge for devanning of containers at night is in "contravention of the law" since it came with no directive from the federal government. "This irregular practice is resulting in an [extra] financial burden on stevedores and terminal operators," the association said. The charges were supposed to become effective on April 1, but have been delayed pending negotiations.
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