Govt. need to revisit PM House Car Auction Proceeds Target
The very sound of auctioning the vehicles fleet at PM housing was like music. The Governments estimates of revenue generation through this auction initially seemed on a very high side. Even during discussion within my circle mostly Imran Khan Fans I was reprimanded for my opinion.
I still feel the proceeds milestone cannot be achieved, I have couple of reasons to prove it, until and unless the true patriot willing to buy them on Government’s expectations.
The buyers inspecting cars and mostly interviewed by private channels are the big fish of automobile dealers. They are addict of buying automobiles are imported through red channels by evading duties, taxes etc.
If we take example of Mercedes cars put up for auction older than 2006 model, the duty and taxes displayed around Rs. 3.9 million, where the later models of 2006 and 2007 SE edition of the same make is available in Rs. 2.5 million to Rs. 3.0 million to these dealers/buyers.
So at auction the cost of vehicles will be final auctioned amount plus Rs.3.5 to Rs. 4.0 million, which will be 25% to 40% higher than the value on which they can buy it from dealers in market.
The Government should identify the syndicate of automobile dealers, the regulatory authorities responsible persons involved in providing safe ways to avoid taxation and duties on import of vehicles, also the re registration of smuggled and stolen vehicles that really hits the automobile industry and its market.
Another factor are the profiteering mafia those who make booking from the automobile manufacturers and then making huge margins with the dealers by managing market price of the automobiles.
The Government has to consider the ground realities and our market dynamics, until and unless we revert to basics and get it right we cannot move ahead.
The Government in its initial period is decision making from top over view; this excludes the basics which makes them readdress their major decision making. The Government’s decision making should start from basic root level; this will help it to implement the decisions eliminating the root cause of wrong doing and stopping the pave for future.
If the Government on Monday fails to achieve desired results, they should not sell off the vehicles in haste. They should mark it as unsuccessful auction again by taking the route they should have taken in initial decision. Consider the market price and then calculate the most viable pricing structure to dispose off the vehicle.
If that cannot be done, the transportation department should revisit all other departments’ requirements, if possible adjust the existing fleet instead of buying new vehicles for that requirement.
The Government should also recheck the auctions made by other Government departments whether the duty and taxes were included in auction and their Fair Market Value was evaluated before auction and in auction the bare minimum price proceed achieved in auction.
In future all auctions should be made after due working of depreciation, fair market value and net realizable value. This should be made mandatory for the sake of transparency and transaction evaluation at arm’s length.
This will not only endorse Government’s claim for transparency advocacy but also prove its sincerity towards its commitment made before coming in Government and PM’s address to nation after taking over Government, not only this but make them stand out from previous Governments rather than among the previous rulers.
I hope the Government takes a heed from the 29 days decision making and then reconsidering them.
It can make task force from world leading professionals volunteer basis but to execute the advise they still have to have right mix of professionals to get the basics right to implement the “BIG IDEAS”
I still feel the proceeds milestone cannot be achieved, I have couple of reasons to prove it, until and unless the true patriot willing to buy them on Government’s expectations.
The buyers inspecting cars and mostly interviewed by private channels are the big fish of automobile dealers. They are addict of buying automobiles are imported through red channels by evading duties, taxes etc.
If we take example of Mercedes cars put up for auction older than 2006 model, the duty and taxes displayed around Rs. 3.9 million, where the later models of 2006 and 2007 SE edition of the same make is available in Rs. 2.5 million to Rs. 3.0 million to these dealers/buyers.
So at auction the cost of vehicles will be final auctioned amount plus Rs.3.5 to Rs. 4.0 million, which will be 25% to 40% higher than the value on which they can buy it from dealers in market.
The Government should identify the syndicate of automobile dealers, the regulatory authorities responsible persons involved in providing safe ways to avoid taxation and duties on import of vehicles, also the re registration of smuggled and stolen vehicles that really hits the automobile industry and its market.
Another factor are the profiteering mafia those who make booking from the automobile manufacturers and then making huge margins with the dealers by managing market price of the automobiles.
The Government has to consider the ground realities and our market dynamics, until and unless we revert to basics and get it right we cannot move ahead.
The Government in its initial period is decision making from top over view; this excludes the basics which makes them readdress their major decision making. The Government’s decision making should start from basic root level; this will help it to implement the decisions eliminating the root cause of wrong doing and stopping the pave for future.
If the Government on Monday fails to achieve desired results, they should not sell off the vehicles in haste. They should mark it as unsuccessful auction again by taking the route they should have taken in initial decision. Consider the market price and then calculate the most viable pricing structure to dispose off the vehicle.
If that cannot be done, the transportation department should revisit all other departments’ requirements, if possible adjust the existing fleet instead of buying new vehicles for that requirement.
The Government should also recheck the auctions made by other Government departments whether the duty and taxes were included in auction and their Fair Market Value was evaluated before auction and in auction the bare minimum price proceed achieved in auction.
In future all auctions should be made after due working of depreciation, fair market value and net realizable value. This should be made mandatory for the sake of transparency and transaction evaluation at arm’s length.
This will not only endorse Government’s claim for transparency advocacy but also prove its sincerity towards its commitment made before coming in Government and PM’s address to nation after taking over Government, not only this but make them stand out from previous Governments rather than among the previous rulers.
I hope the Government takes a heed from the 29 days decision making and then reconsidering them.
It can make task force from world leading professionals volunteer basis but to execute the advise they still have to have right mix of professionals to get the basics right to implement the “BIG IDEAS”
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