THURSDAY MARCH 31: Import activity back to normal
After two weeks' suspension, import activities have resumed at ports as the Federal Board of Revenue (FBR) has temporarily restored sales tax zero-rating facility for five leading export oriented sectors with immediate effect. Import process came to a complete halt since March 15 and thousands of containers loaded with goods were stranded at ports after the implementation of new tax rules announced by the FBR.
Copyright Business Recorder, 2011
Sources told Business Recorder on Wednesday that importers and their customs agents started filing goods declarations to get their consignments released as soon as possible. However, due to Pakistan-India cricket semi final the process remained slow on Wednesday.
The FBR on Tuesday announced that the SRO.231 (I)/2011, under which five zero-rated sectors - textile, sports goods, surgical, carpets and leather were asked to pay tax on local sales, has been held in abeyance. According to the FBR notification the government/FBR are reviewing the sales tax zero-rating scheme of SRO 509(I)/2007 and a new notification will be issued shortly in this regard effective March 15, 2011.
Since the most of import consignments lying at customs ports are held up due to the application problems in relation to the SRO 231 with the result that manufacturers of the five major export sectors are facing raw material shortage. Therefore, to overcome this unanticipated situation, the FBR announced this measure. According to importers the held-up consignments of all categories are now entitled to take benefit of SRO 509 of July 9, 2011 which was applicable before SRO 231 and could be cleared according to previous process. In addition, as per the FBR announcement special excise duty is also not applicable on such consignments, they added.
Importers said that with the FBR announcement, importers have asked their customs agents to file GDs. However, the clearance process is taking time as the import process was suspended some 15 days ago and presently over 10,000 containers are in queue awaiting release. They asked customs authorities to make special arrangements for early release of stuck-up consignments to avoid more losses to exporters as most of the consignments have raw material for export goods.
Currently, consignment of fabrics, leather, chemicals, pulses, second-hand cloths, steel products, garments and many others are stuck up at ports, they said. "We want to support government for broadening the tax base to generate more revenue, however already registered taxpayers should not be burdened with additional taxes and instead non-registered persons should be brought into tax-net," they said. Importers lauded the efforts of Salman Siddiqui, Chairman FBR and other officials for taking timely action for release of imported consignments.