AIRLINK 74.64 Decreased By ▼ -0.21 (-0.28%)
BOP 5.01 Increased By ▲ 0.03 (0.6%)
CNERGY 4.51 Increased By ▲ 0.02 (0.45%)
DFML 42.44 Increased By ▲ 2.44 (6.1%)
DGKC 87.02 Increased By ▲ 0.67 (0.78%)
FCCL 21.58 Increased By ▲ 0.22 (1.03%)
FFBL 33.54 Decreased By ▼ -0.31 (-0.92%)
FFL 9.66 Decreased By ▼ -0.06 (-0.62%)
GGL 10.43 Decreased By ▼ -0.02 (-0.19%)
HBL 114.29 Increased By ▲ 1.55 (1.37%)
HUBC 139.94 Increased By ▲ 2.50 (1.82%)
HUMNL 12.25 Increased By ▲ 0.83 (7.27%)
KEL 5.21 Decreased By ▼ -0.07 (-1.33%)
KOSM 4.50 Decreased By ▼ -0.13 (-2.81%)
MLCF 38.09 Increased By ▲ 0.29 (0.77%)
OGDC 139.16 Decreased By ▼ -0.34 (-0.24%)
PAEL 25.87 Increased By ▲ 0.26 (1.02%)
PIAA 22.20 Increased By ▲ 1.52 (7.35%)
PIBTL 6.80 No Change ▼ 0.00 (0%)
PPL 123.58 Increased By ▲ 1.38 (1.13%)
PRL 26.81 Increased By ▲ 0.23 (0.87%)
PTC 14.01 Decreased By ▼ -0.04 (-0.28%)
SEARL 58.53 Decreased By ▼ -0.45 (-0.76%)
SNGP 68.01 Decreased By ▼ -0.94 (-1.36%)
SSGC 10.47 Increased By ▲ 0.17 (1.65%)
TELE 8.39 Increased By ▲ 0.01 (0.12%)
TPLP 11.05 Decreased By ▼ -0.01 (-0.09%)
TRG 63.21 Decreased By ▼ -0.98 (-1.53%)
UNITY 26.59 Increased By ▲ 0.04 (0.15%)
WTL 1.42 Decreased By ▼ -0.03 (-2.07%)
BR100 7,943 Increased By 105.5 (1.35%)
BR30 25,639 Increased By 187.1 (0.73%)
KSE100 75,983 Increased By 868.6 (1.16%)
KSE30 24,445 Increased By 330.8 (1.37%)

The Federal Board of Revenue (FBR) is required to issue a legal clarification for clearance of stuck-up consignments of edible oil in customs bonded terminals located at Karachi without payment of 3 percent Sales Tax in value added tax (VAT mode).
In this regard, the ghee and cooking oil industry has approached Abdul Hameed Memon, Chief ST & FE Policy Federal Board of Revenue (FBR), on the issue of non-applicability of sales tax in VAT mode @ 3% under 12th Schedule of the Sales Tax Act, 1990 incorporated through Finance Act, 2019-20 on import of edible oil.
It is expected that the FBR will timely issue the legal clarification to avoid shortage of ghee/cooking oil in the market.
The industry has submitted for obtaining necessary clarification from Board that import of edible oil has been granted exemption from Sales Tax vide entry No. 24 of Sixth Schedule when read with Section 13 of the said Act. Moreover FED @ 17% ad valorem has been levied and collected on import of edible oils vide First Schedule (read with Section 3 of Federal Excise Act, 2005).
The industry has referred to the 'Procedure and Conditions' enumerated in subject schedule, wherein vide paragraph 2 (i) explicitly exemption from VAT has been granted for raw material and intermediary goods meant for use in an industrial process which are subject to customs duty at a rate less than 16% ad valorem under First Schedule of Customs Act, 1969. All variants of edible oils fully comply with the stated condition and attracts customs duty much lower than 16% ad valorem, hence qualifies to be exempted from levy of 3% ad valorem Sales Tax in VAT mode vide the 12th Schedule.
Availing the opportunity, it is reiterated that since 1st July, 2019 the consignments of edible oil have been stuck-up in Custom Bonded Terminals located at Karachi, for want of clarification, since the customs authorities are pressing hard to deposit the 3% VAT or obtain necessary clarification from 'Board' on the issue in-hand.
The favorable clarification may be issued at the earliest, since signs of shortage of end products (ghee & cooking oil) are now visible in the market, besides importers exposure to demurrages and huge penalties, the industry added.

Copyright Business Recorder, 2019

Comments

Comments are closed.