1pc withholding tax on goods imported for zero rated regime

Monday, 06 February 2012 22:48

KARACHI: FPCCI Vice President and Chairman FPCCI Standing Committee on Liaison with FBR, Shakeel Ahmed Dhingra has appreciated Federal Board of Revenue (FBR) for its quick rectification of withholding tax.

FPCCI release here on Monday said that Mr Dhingra praised FBR's Member Inland Revenue, Shahid Asad for taking immediate action and issuing clarification that only 1 per cent withholding tax will be charged from commercial as well as industrial importers, instead of 5 per cent at import stage on items specified in SRO 1125(I)/2011.

This SRO dated Dec 31, 2011 was regarding duty free import of raw material for five zero rated export covered textiles, leather, carpets, surgical goods and sports goods.

He elaborated that in the absence of FBR Member Inland Revenue the Customs authorities were charging withholding tax at the rate of 5 per cent on the goods imported under SRO 1125(I)/2011 for the zero rated regime due to wrong interpretation of the law.

However, when Member Inland Revenue was contacted by Federation of Pakistan Chambers of Commerce and Industry (FPCCI) on his return from abroad he immediately issued the instruction to the concerned authorities to charge the correct amount of tax which is only 1 per cent.