The Central Board of Revenue (CBR) has recommended to the anomaly committee to reduce customs duty on the import of brass flat wire (Pakistan Customs Tariff heading 7408.2100) to 15 percent. The CBR has also suggested reduction in customs duty on glass fiber disc (PCT heading 7019.9090) from 20 percent to 5 percent.
In most of the cases, the CBR has recommended to the anomaly committee to maintain status quo as tax authorities opined that most of the anomalies pointed out by private sector are in new budget proposals and not in the Finance Bill 2005-06.
The CBR had received a number of representations from the business community to reduce customs duty on different items.
The CBR has also obtained the viewpoint of Engineering Development Board (EDB) on each issue and subsequently drafted its comments for the anomaly committee.
Following are the private sector's proposals for anomaly committee, along with EDB's recommendation and CBR viewpoint on each case for further action by the anomaly committee:
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Anomaly cases - Budget 2005-06
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S.NoISSUE H.S. Code Description Pre Post Proposed EDB's Comments CBR's Comments
budget budget duty
rate rate
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1 The Office of the Minister for 4819.2000 Folding cartons 25 25 15 EDB has not supported the Not agreed as there
Production and Industry has reduction in duty that this is no anomaly. It is
suggested vide fax messaged dated 9th item is being manufactured a fresh request for
June,2005 to reduce the duty on two locally. The annual reduction in duty.
packing material items HS heading estimated consumption is
4819.2000 and 7607.2000 from 25% to 200,000 ton out of which
15% and from 20% to 10% respectively. 130,000 ton was locally
EDB and M/o Industries were requested manufactured in the
to provide information relating to local organised.
manufacturing of the items along with
the intimation about the raw materials
used in the manufacture of these items
so that the readjustment of the duty is
examined.
7607.2000 Aluminium foil 20 20 10 EDB has not supported the
reduction in duty because
the item is being
manufactured locally and it
is included in the CGO
relating to locally
manufactured goods.
2 M/s. Council of Textile Association 3923.2900 Poly bags 25 25 10 EDB has not agreed to it on Not agreed as there
has stated that most of these 3923.9000 Plastic strips for 25 25 10 the plea that the items are is no anomaly and
items have duty higher than 20% collar & packing being manufactured locally. it is a fresh request
which should 'have been reduced because loc 3926.2090 Needel punch 25 20 10 for reduction in
industry can never produce quality and 5807.1000 Garment 25 25 10 duty.
quantity for export production. The Accessories/labels
customs duty should not be rated higher 4821.1000 Paper tags/Hnag 25 25, 25 10
than 10% and zero rated sales tax. 4821.9000 tags
8308.2000 Rivets/Eyelets/Stop 25, 25, 25 25 10
8308.9000 pers 25
8309.9000
9686.2900
9606.1000 Buttons, metal, 25, 25 25, 25 10
9606.2100 horn, nylon etc
9606.2200 Zippers Nylon 25, 25 25, 25 10
9606.2900
9607.1100 Zippers Nylon 20, 20 20, 20 10
9607.1900
3923.9000 Plastic strips for 25 25 10
collar & packing
3 M/s. Swat Ceramics Company has 2818.3000 Calcined alumina 5 5 5 Duty is already @ 5%. No Duty on six raw
requested to zero rate its raw material change suggested by EDB materials has
particularly glass frit (3207.4010) which 2836.6000 Barium carbonate 5 5 5 Duty is already @5%. No already been
is the main raw material for ceramic change suggested by EDB reduced. Thus
industry along with duty reduction on 2839.1100 Sodium 10 5 5 Already reduced to 5%. No sufficient benefit
other items (Annex-C) metasilicate change suggested by EDB has been provided.
3207.4010 Glass frit 5 5 0 5% duty on this item Besides this there
recommended by EDB is no anomaly in
3207.4090 Luster (Powder) 20 10 5 Duty already reduced to the tariff. Hence
10%. No change suggested request of the party
by EDB is not agreeable.
(Annex-2)
3506.9900 Serai graphic 25 20 5 Duty already reduced to
chemicals 20%. No change suggested
by EDB
3824.9099 Decoflux 25 10 5 Duty already reduced to 5%.
No change suggested by
EDB
3824.9099 Printing Medium 25 10 5 Duty already reduced to 5%.
No change suggested by
EDB
6815.9900 Alumina balls 25 25 5 Locally manufactured not
recommended for reduction
in duty by EDB.
6902.9090 Refectory/slab/rollers 10 10 5 Not recommended for
reduction in duty by EDB
6903.9010 Other refractory 20 15 5 Duty already reduced to
ceramics goods 15% EDB considers it
sufficient reduction.
4 M/s. Bin Rasheed Color & Chemicals 3206.1900 Master batches 20 15 25 EDB has not recommended There is no
Manufacturing Company has stated (white) any change against this HS anomaly.
that finished masterbatches are heading.
categorized in two HS 3206.1900 (white 3206.4900 Master batches 10 5 25 EDB has recommended that It is not possible to
masterbatches) and 3206.4900 (all (coloured) duty may be reverted back increase the duty as
colored) the new duty rates to be to 10% from 5%. suggested by EDB.
followed for import for these two
products are 15% and 5% respectively.
This is anomaly in the budget. These
duty rates may be increased to 25%
instead of 15% and 5%,as the local
manufactured or masterbatches can
import their respective raw materials @
import their respective raw materials @
5% under SRO 565/05, whereas, the
finished item/product would be @ 25%.
(Annex-D)
5. M/s. Pakistan Dystuffs manufacturers 3204.1100 Disperse dyes 20 15 10 Duty on locally Not agreed as there
Association has stated that the duty on 3204.1200 Acid dyes 20 15 10 manufacturer dystuffs has is no anomaly.
two types of dyes has been kept at 5% been maintained at 15% and
whereas on three other is 15%. Thus those not manufactured
there is a gap of 10% between the two 3204.1300 Basic dyes 10 5 10 locally have been kept at
slabs and it will result into 5%. EDB has pointed out
misdeclaration. A uniform tariff rate on 3204.1400 Direct dyes 20 15 10 that there is no amomaly in
every item of dyes @ 10% is suggested. 3204.1600 Reactive dyes 20 15 10 it.
6. M/s. Pakistan Papersack Corporation Ltd 4804.2100 Sack kraft paper 20, 20 15, 15 This issue has been Not agreed as there
has suggested to rationalize the 4804.2900 discussed in many pre- is no anomaly.
import duty on raw materials at 10% budget meetings. A
which will still give an advantage of 5% conscious decision has been
to the polypropylene industry. taken by the Board. No
change is required.
7. M/s.Pak Buttons Industries Ltd has 7408.2100 Raw materials 20 20 0 EDB has not agreed to the Duty on brass flat
stated that duty on raw materials of brass flat wire request for zero rated duty wire (7408.2100)
brass flat wire used for manufacture of on brass flat wire under may be reduced to
finished zipper is 20% with the same PCT 7408.2100. A 5% 15% to keep a
rate on finished product. spread between input and difference of 5%
9607.0000 Finished Zippe20 20 20 finished product is on finished product
considered sufficient. Duty vis-à-vis raw
on brass flat wire material.
(7408.2100) is, recommended
for reduction to 15% from
existing 20% maintaining
the finished zipper at
20%. (Annex-3&4)
8. M/s.Siddico Dyestuffs Pigments has 3204.1100 Disperse dyes 20 15 5 EDB has intimated that Not agreed as there
requested that realistic review may be 3204.1200 Acid dyes 20 15 5 these days manufactured is no anomaly.
made and for application of minimum locally therefore, duty is
5% import duty and zero rated sales tax maintained at 15% and 20%
be allowed on these items. which should not be
3204.1200 Silicones in 20 15 5
primary forms,
other
3204.1400 Direct dyes 20 15 5
3204.1600 Reactive dyes 20 15 5
3204.1700 Pigments and 20 15 5
preparations based
thereon
3204.2000 Fluorescent 20 20 5
brightening agents
3206.4900 Other 10 5 5
3402.1100 Organic surface 10 10 5
active agents
anionic
3402.1200 Organic surface 20 20 5
active agents
cationic
3402.1300 Organic surface 20 20 5
active agents
nonionic
3403.9090 Lubricating 20 20 5
preparations, other
3906.9090 Acrylic polymers 20 20 5
in primary forms,
other
9 M/s. Olymipa Industries (Pvt) Ltd has 3906.9090 Acrylic emulsion 20 20 5 EDB has pointed out that Not agreed as there
approached the Board that the duty of binder both these items are is no anomaly.
the finished product(5603.9200) has manufactured locally,
been reduced from 20% to 15% in the therefore, no duty reduction
budget. The current duty on acrylic is supported.
emulsion binder (3906.9090)@ 20%
and Melamine Resin (3909.2000) 25%.
The duty on the raw materials may be 3909.2000 Melamine resin 25 25 5
reduced to minimum level and zero
percent sales tax.
10 M/s. Gatron Industries Ltd has stated Bobbins 25 25 5 EDB has not agreed to Not agreed as there
that the customs duty on bobbins is 25% reduce duty on bobbins is no anomaly.
(which is very high rate of customs duty because those are
textile chain), while customs duty on manufactured locally.
polyester filament yarn has been
reduced to only 7% from 20%. The
Bobbins are compulsorily used in textile
chain for winding of textile yarn. The
duty on bobbins may be reduced from
25% to 5%.
11 M/s. Beijing Print (Pvt) Ltd has 7502.1000 unwrought nickel 5 5 0 EDB has stated that rotary Not agreed as there
requested to reduce the duty to 0% on printing screen (7508.9010) is no anomaly.
the listed items that those are not is at 10% and its raw
manufactured locally. Materials is 7502.1000
which is at 5%. Same is the
7606.1100 Aluminium plates, 10 10 0 position in other items.
sheets and strip of Hence, there is no
thickness need for
exceeding 0.2 mm any further reduction in
(raw material) duty
7607.1990 Aluminium foil 20 20 0
(whether or not
printed or backed
with paper,
paperboard, plastic
or similar backing
materials) of
thickness not
exceeding 0.2mm.
12 M/s. Brightex Industries Ltd has stated 3204.1900 Dyes stuff 10 5 - EDB has suggested 5% duty Duty on dyes stuff
that basic raw material is chargeable to against HS 3920.6900. 3204.1900 which is
20% while finished product attracts not manufactured
10% only. (metallic powder- 5605.000). locally has been
As we import at 20% and involve reduced to
processing charges and other expenses. 5%. Uncoated
It has been requested to reduce the duty polyester film
on un-coated polyester 3920.6900 Un-coated 20 20 5 (920.6900) is not the
film(Metalised)(HS 3920.6900) to 5% polyester film main or direct raw
which is the major raw material for (metalised) material of dyestuff.
manufacture of metalic Thus there is no
powder(5605.0000). anomaly in the tariff.
13 M/s. ICI Pakistan has approached the 2501.0010 Sodium 25 20 EDB has pointed out that Not agreed as there
Board that a large number of raw tripolyphosphate duty on solvents and other is no anomaly.
materials where customs duty is equal to 2526.2000 Nytal 200 20 20 raw materials of paint
or higher than that of finished goods. 2707.9990 Solvent C9 25 25 industry was reduced to 5%
The duty may be reduced on raw 2803.0010 Thermax floform 25 25 is budget 2004-05 and
material. 2803.0090 N990 2005-2006 as such there is no
2815.1100 Carbon black FW anomaly.
2915.3100 200 20 20
2915.3300 Acetone 25 25
3204.2000 Ethyl acetate 25 25
3211.0000 Butyl acetate 25 25
Uvitex OB 20 20
3402.1300 Calcium, zinc, cobalt, 20 20
zirocnium driers
Additives: surfactant 20 20
3402.9000 Brij. Synperonic,
Berol 185
3404.9090 Perlankrol FD 25 25
3808.9000 63/Uracron
3906.9010 Cerector 48 10 10
3906.9090 Proxel GXL/Nuosept 25 25
Modaflow resin 20 20
3907.3000 Uracron CY 433, 20 20
3907.6090 Disperton: acrylicresin
3909.2000 Epikote resins 20 20
3911.9000 Special resins 20 25
3912.2010 Uramex MF 866 25 25
Specially resins 20 20
Nitrocellulose 20 20
14. M/s. T&N Fixed Star (Pvt) Ltd has 2916.1100 Acrylic acid & its 5 5 0 EDB has not supported any Not agreed as there
stated that the raw materials imported salts reduction in duty. is no anomaly.
by the Thickner industry for its own 2942.1910 Acetained 5 5 0
consumption be exempted from customs 2711.1900 Petroleum Gases & 5 5 0
duty. other gaseous
3402.1300 Organic surface - 20 5 0
active agents Other
2924.1990 Cyclic amid & 5 5 0
derivatives Other
2909.1910 Metyle tertiary 5 5 0
Butyle Ether
2833.4000 Per sulphates 10 5 0
10 0
15 M/s. Ilyas Sons Corporation has stated 2710.1996 White oil 25 20 10 EDB has suggested to It is a fresh request
that rate of duty has been suggested to 3402.1190 Sulphonic acid soft 25 20 0 reduce the duty to 5% for duty reduction.
be reduced on the plea that these are 3402.1200 Cationic softners 20 20 10 against HS 3910.0000 only. There is no
being used in the textile industry which 3402.1300 Nonyl phenol 20 20 10 Rest is not supported anomaly in the
is an export oriented industry. ethoxylates tariff. Hence the
request of the party
3402.1300 Fatty alcohol 20 20 10 is agreeable.
ethoxylates
3403.9190 Fatty amine base 20 20 10
softneres
3910.0000 Silicone emulsions 10 10 5
3910.0000 Silicone antifoam 10 10 5
3910.0000 Silicone textile 10 10 5
fluid
16 M/s DADEX Eternit Limited has stated 39.17 Tubes, pipes and 25 20 25 EDB has pointed out that Not agreed as there
that duty on the given items was hoses, and fittings since the duty on raw is no anomaly.
reduced from 25% to 20%. DADEX of plastics material was reduced,
being the local manufacturer of these 3917.2100 of polymers of 25 20 25 therefore, the request of the
items has requested to increase the duty ethylene party is not supported.
to 25%. 3917.2200 Of polymers of 25 20 25
propylene
3917.2200 Of polymers of 25 20 25
vinyl chloride
3917.2390 other 25 20 25
3917.2900 Of other plastics 25 20 25
3917.4000 Fittings 25 25 20
17 M/s. Punjab Tinplate Association has 7210.1200 Tinplate 25 25 10 It is being manufactured Not agreed as there
request to reduce the customs duty on locally and the industry is no anomaly.
tinplate from 25% to 10% to provide a enjoys protection.
relief to common man.
18 M/s. Sharp Corporation, Customs House 4008.2900 Other (Printing 20 20 5 EDB has recommended to Not agreed as this
Agents have requested that the printing Blanket in rolls) create new HS heading to is not a case of
blanket imported in roll under HS accommodate the request anomaly.
4008.2900 @ 20%. Duty in light of 4016.991 Printing blankets 5 5 5
CGO 12/2002 Ch II S.No 3 (in sheets)
classification Item No 20, where the
same item imported in sheet shown by
name in customs tariff under HS
4016.9910 @ 5% duty. Printing
blankets are only used for printing
industry both rolled and sheets.
This is also worthy to mention here
that we are sending these proposals
repeatedly through FPCCI & LCCI
form last three years but no heed
given to our suggestions.
(Annex-R)
19 M/s. Karachi Chamber requested that,- Duty on pressed and Not agreed as there
(i) Duty on waste paper may be reduced bundled waste is 5%. No is no anomaly.
from 10% to 5%. further reduction is
(ii) Duty on coated and uncoated papers supported. Other items
are in highest slab of 20-25%, it should being manufactured locally.
be reduced to the lowest slab, as these 9609.1000 Pencils and 20 20 10 No reduction in duty is
are used as packing material for export crayons, with supported.
goods as well as paper is also used in leads,
for educational purposes. 9017.2090
Due to mass smuggling of lead pencil 8305.2000 Staple in strips 25 25 10
(9609.1000), eraser (9017.2090),staple
pins(8305.2000), it is proposed that 2821.1010 Iron oxides 10 10 5
customs duty be reduced from 20-25%
to 10%.
(iiiThe customs duty and sales tax on 3204.1700 Pigments and 20 15 5
almost all the industrial raw material has preparations based
been reduced to 5% & 0% respectively, thereon
therefore, the duty and sales tax on three 3206.4210 Lithopone 20 20 5
raw materials having HS 2821.1010,
3206.4200 and 3204.1700 used in paint 3206.4290 Other 25 20 5
industry be also reduced to 5% and 0%
respectively.
20 M/s. SANDAL Dyestuff Industries Ltd EDB does not support any Not agreed as there
has requested that,- (i) A protection further readjustment of is no anomaly.
level may be maintained in locally duties on dyes/chemical. It
manufactured or not manufactured dyes has stated that raw materials
by offering 10% tariff difference in raw for dyes and chemicals not
materials and finished products. This manufactured locally have
gap gets reduced to 8.50% through been kept @ 5% and
SRO.558(I0/2004. Hence it is finished dyes which are
recommended to rescind produced locally are kept at
SRO.558(I)/2004 with immediate effect. 15% and 20%. No further
rationalization is needed.
RO.558(I)/004 is SAARC
related notification which
cannot be rescinded.
(ii)Customs duties on dyestuff falling
HS 3204.1300 (basic dyes and
preparation based thereof) and HS
3204.1590 (Others) have been reduced
to 5% (previously 15%) while most of
the dyestuff fall under customs duty of
15%. This difference of 10% in duty
will definitely leave a huge incentive for
clearance of goods by misdeclaration
which will cause huge loss to govt.
exchequer . So it is recommended to
impose duty on 3204.1200 & 3204.1300
at rate specified for other dyestuffs ie
155 so that there would be no incentive
for misdeclaration.
(iii) Custom duty on carbon black @ 2803.0090 Carbon black 20 20 5
25% - Rubber grade has been proposed
because this item is being produced in
Pakistan while duty for carbon black
under HS 2803.0090 is 20% . As this
item is not being produced in Pakistan,
we recommend to reduce custom duty
on HS 2803.0090 to 5% because this is
a raw material for dyestuff industry.
21 M/s. MKB Group of Companies that 3904.1090 Poly vinyl chloride 25 20 10 EDB had recommended at There is no
duty on polymers of vinyl chloride the time of budget to reduce anomaly in the
falling HS 3904.1090, 3904.2100 and duty on HS heading tariff. The due
3904.2200 has been retained at 20% as 3904.2100 from 25% to benefit has already
against 5% on all other plastic raw 20% and to maintain the been passed on to
materials. Polymers of vinyl chloride duty of 20% against HS the industry. Even
under HS 3904.1090 is being heading 3904.2200. the duty against HS
manufactured locally be Engro Asahi heading 3904.1090
but other vinyl chloride under Hs has also been
3904.2100 and 3904.2200 being raw reduced from 25%
material for manufacturing hot water to 20% besides
supply pipes and pressure fittings due to accepting the
it enhanced heat-resistance is not being recommendations
manufactured locally yet the rate of of EDB against HS
custom duty on such resins/compounds heading 3904.2100.
is levied at 20% in the budget which No further
departs from the spirit of free trade and adjustment in duty
seriously violates the basic principal of is supported.
cascading. It is suggested that duty on
other poly vinyl chloride, HS 3904.2100 3904.2100 Non plasticised 25 20 10
and 3904.2200 may not be levied in 3904.2200 Plasticised 20 20
excess of 5%. The duty on poly vinyl
chloride HS 3904.1090 being
manufactured locally may be reviewed
downward to 10% instead of 20%.
22 M/s.Gujranwala Chamber of Commerce 5402.4100 Synthetic yarn 20 7 5 Duty on one raw
& Industry has requested the following:- material ie, glass
(i) First of all felt backing used in carpet 5407.2000 Synthetic backing 25 14 5 fiber disc
backing, its duty was 5% which is (7019.9090) may
increased to 15% in the budget, whereas be reduced from
the customs duty on finished carpets is 5603.9300 Felt backing 20 15 5 EDB has stated that the 20% to 5%.
10%, it means the raw material is major raw materials for
expensive than the finished product. grinding wheels ie glass
Similarly in case of woven backing the 2818.2000 Al Oxide 5 5 fiber Disc (7019.5900) is
import duty was 5% in the last budget, already covered at Sr.No 36
which is also increased to 10%. it is a of SRO.565/2005 at 10%. As
clear cut anomaly & against the spirit of 2849.2000 Silicone carbide 10 5 the duty on finished product
budget & WTO rules. We are giving under HS 6804.2200 has
below the chart of anomalies with the been reduced to 5%, their
request to remove the anomalies so that 3909.4000 Liquid resin 20 20 request merits consideration.
industry could work in competitive It is recommended that duty
environment. is SRO. on Glass fiber
(ii)Whereas the duty imposed on 3909.4000 Powder resin 20 20 Disc(7019.9090 be reduced
finished grinding/cutting disk wheels is from 10% to 5%.
5% in the budget. In the last budget duty
was 10%. It should be increased to 25%
or to maximum limit under PCT 2826.3000 Cryolite 10 5
6804.2200. Despite increasing, duty on
finished grinding cutting disks/wheel is
again reduced. The anomalies & 2706.0010 Anthracene oil 10 10
increase the duty on finished product of
grinding. cutting, disk/wheels etc so
that the local industry should be 7019.5900 Glass faber disc. 20 20
protected in its true letter and spirit.
23 M/s. K.S.Sulemanji Esmailji & Sons 1105.2000 Potato flakes 25 25 0 EDB has recommended May be reduced
Ltd has requested that the duty on reduction in duty but did no to 15%.
imported snacks is 25%. Current duty indicate the level.
on potato flakes and potato starch is
15% is again very high. Both these raw 1108.1300 Potato starch 20 15 0 Reduction of duty to 15% on Already @ 15%.
materials may be considered at zero potato starch is suggested by
rated. EDB
24 M/s. Nadeem Impex, Wasif Impex have 3919.9000 OPP packing tape 20 20 Duty against HS
requested that the duties on both the HS and PVC heading
codes has been made equal at 20%. One inslulation tapes 3919.9000 may be
is finished item (3919.1090) and other is reduced from
raw materials (3919.9000). As they will 20% to 15% to
not be able to compete with the goods maintain a
that will flood in from China and 3919.1090 OPP packing tapes 25 20 25 EDB has recommended that difference of 5%
Taiwan(in the form of retail packaged and PVC electric duty on OPP package tape be between the raw
packing) insulation tapes enhanced to 25% material and
finished product.
25 M/s. Pakistan Slag Cement Industries Clikner 25 25 0 They are partially dependent Not agreeable.
Ltd has requested that tariff rate on on the integrated Cement
imported clinker may be reduced from manufacturers for the supply
25% to zero per cent and adjustment of of raw material. The request
federal excise duty payable on imported merits consideration.
clinker may be allowed against the
excise duty leviable on portaland
cement manufactured from the
admixture of slag and clinker.
26 M/s. METATEX(Pvt) Ltd has stated 4810.1390 Paper(plain) 25 25 5 EDB has not supported the No change in duty
that in the budget while the Govt request on the plea that the structure has been
encouraged major manufacturing items are being manufactured made in the
activity locally and allowed duty locally. budget. Thus
concessions to many items which are there is no
not manufactured locally and are further anomaly. It is a
processed and used for Export fresh request of
packaging but no change has been made 4802.2000 to Paper (printed) 10 5 5 the party duty for
in the duty structure of paper which is 4802.4000 reduction of duty
required to be made. swhich is not
supported.
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