Imported items: FBR explains retail price taxation conditions

The Federal Board of Revenue (FBR) Wednesday informed importers that retail price taxation will not be applicable on items which are not in retail packing at the time of import and appear (in retail packing) in the entries/items of Third Schedule of Sales Tax Act, 1990.
According to a Sales Tax General Order (STGO) 103 of 2019 issued by the FBR on Wednesday, the Board vide a letter directed that imported Third Schedule items be allowed clearance after affixation of stickers printed with retail price till July 31, 2019.
The Board has received several representations highlighting various issues and requesting further extension in the aforesaid time period. Accordingly the Board is pleased to provide as under:-
For the imports from North and South America, if bill of lading date is prior to
June 30, 2019, the condition of printing retail price is relaxed up to August 31,
2019, subject to the condition that the importer declares retail price for each of the imported items in terms of the Section 2(27) of the Sales Tax Act, 1990, and that the goods are assessed for sales tax on such declared retail price.
The FBR clarified that the retail price, if not printed at import stage, can be printed at the port of import in the prescribed manner. If that is also not possible, the importer will undertake to print the retail price after clearance of goods and will pay sales tax on retail price which will not be less than 130 percent of the customs value increased by assessed customs duties, excise duty and other applicable taxes and charges excluding sales tax.
If the phrase "in retail packing" appears against any item/entry in the Third
Schedule, the retail price taxation thereon will not apply if such items are not in retail packing at the time of import. All other items will be charged to sales tax on the basis of retail price even if not in retail packing, the FBR maintained.
Under the existing law, the goods being raw materials or intermediary goods, with customs duty rate below 16 percent, are excluded from purview of value addition tax under the Twelfth Schedule. Such items, if imported by a commercial importer, are in such form that the same can be sold to the customer without further manufacturing process, such as tea, spices etc, and the same will be the subject to value addition tax, the FBR added.