ISLAMABAD: The Federal Board of Revenue (FBR) has automated the system for issuance of the exemption certificates to exempt withholding tax on import stage on plant, machinery and raw material and allied equipment for setting up industrial undertakings including hotels.
The FBR has issued new SRO 1020(I)/2020 to rescind the SRO 947(I)/2008, here on Saturday. The rescinded SRO 947(I)/2008 was related to the powers of the Commissioner Inland Revenue to issue exemption certificates to exempt withholding tax on import stage on plant machinery and raw material and allied equipment.
The SRO 947 had empowered the Commissioner of Income Tax concerned, in accordance with the provisions of clause (b) of sub-section (3) of Section 159 of the Ordinance to issue a system-based exemption certificate only (through computer) in the cases of a person who imports plant, machinery, fixtures, fittings or its allied equipments for the purposes of setting up an industrial undertaking (including hotels) owned by such person.
Now, the FBR has rescinded the SRO 947(I)/2008. When asked, whether the powers of the Commissioners to issue exemption certificates has been withdrawn by rescinding the SRO 947(I)/2008, senior FBR officials told Business Recorder that the system had now been automated.
On the other hand, a tax expert raised a question that how the system can be automated without any legal sanction. The legal basis was provided through the SRO 947(I)/2008 that has now been withdrawn.