The enhanced rate of 2.5 percent of special excise duty (SED) would be applicable on notified categories of nonessential and luxury imports and domestic manufactures of air conditioners, beverages, cigarettes, cosmetics, deep freezers, detergents, motor cars and other items.
Sources told Business Recorder here on Thursday that 2.5 percent SED of the value shall be levied, collected and paid on goods specified in the First Schedule of the Customs Act, 1969 except the goods mentioned in the S.R.O. 655(I)/2007. The 2.5 percent of the SED would not be applicable on a large variety of essential goods like basic food items, edible oil, fertilisers, pesticides, pharmaceuticals, medicines, electricity, natural gas, POL products, iron and steel items and computers.
Sources said that the SED would not be applicable on vegetables, seeds, edible oil, POL products, natural gas/LPG, electricity, phosphoric acid, pharmaceutical products, fertilizers, gold and silver, tin plate, computer hardware, bitumen, currency notes as well as items classified in Chapter 99 of Pakistan Customs Tariff and temporarily imported goods under the Duty and Tax Remission for Exports (DTRE) scheme.
Moreover, items on which sales tax is zero-rated shall also not be liable to Special Excise Duty. This levy would also not be applicable on the imported goods subject to customs duty at the rate of zero-percent under Customs Act or any notification issued thereunder.
The special excise duty would not also be applicable on the supplies made by the cottage industry and goods produced for subsequent export by the manufacturers. Exemption from SED would be applicable on the imports made by privileged personnel/organisations under grant-in-aid agreements; goods imported by various agencies of the United Nations; diplomats/embassies; household articles including vehicles and goods for donation to projects established in Pakistan, imported by the rulers and dignitaries of UAE and Qatar.
As per SED related notifications issued in the past, sources said that the special excise duty would not be applicable on goods supplied free of cost as replacement of identical goods previously imported; goods imported into and exported (except to tariff area of Pakistan) from the Export Processing Zones and any enactment relating to Gwadar Special Economic Zone and the levy would not be applicable on un-cut precious and semi precious stones; polished semi-precious stones; jewellery casting powder; moulding rubber; injection wax; jewellery casting machines and accessories; rhodium-plating solution concentrate; bright and chrome lacquering solution; steel balls and pins (different sizes) used for polishing; diamond cutting tools; alloys of silver copper and zinc for mixing in 24 ct. gold; mounts and findings of gold, silver and platinum jewellery and ground handling equipment, service and operation vehicles, catering equipment and fuel trucks not manufactured locally, imported by domestic airlines or by any other service company to which a licence has been issued by the Civil Aviation Authority.
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