FBR decides to establish Tractors Subsidy Cell

24 Nov, 2020

ISLAMABAD: The Federal Board of Revenue (FBR) has decided to establish a Tractors Subsidy Cell for tractors' manufacturers for processing of adjustment of subsidy against sales tax on locally-manufactured tractors. The FBR has issued the Sales Tax Special Procedure for Adjustment of Subsidy Against Sales Tax on Locally Manufactured Tractors Rules, 2020, here on Monday.

These rules shall come into force from September 28, 2020, and shall remain in force till June 30, 2021, or till the time, the amount of subsidy of rupees one and a half billion is exhausted, whichever is earlier.

The subsidy granted, shall be allowed to be adjusted by the manufacturers of the tractors namely M/s Millat Tractors Limited, Al-Ghazi Tractors Limited, and Orient Tractors (Pvt) Limited, hereinafter, referred to as the specified manufacturers, in the specified manner, the FBR said.

Ministry of National Food Security and Research shall apportion the amount of subsidy among the specified manufacturers, so that the same does not exceed the limit of Rs1.5 billion.

According to the rules, a Tractors Subsidy Cell shall be established by the IR-Operations Wing of the FBR for processing subsidy adjustment claims. The specified manufacturers shall sell the subsidised tractors only to the farmers and growers after obtaining a valid proof of land holding such as Agriculture Pass Book and copy of record of rights of agricultural land duly verified from Provincial Land Revenue Authorities, and shall not charge and collect applicable amount of sales tax from such buyers.

The whole value of the tractor applicable amount of the sales tax and amount of subsidy shall be mentioned on the sales tax invoice as specified under Section 23 of the Sales Tax Act issued by the specified manufacturers, the FBR added.

The Ministry of National Food Security and Research after examination of the adjustment claim shall forward its report to the Tractors Subsidy Cell of the FBR within seven working days of submission of the Part-1 of the Annexure-A by the specified manufacturers, mentioning the amount of subsidy to which such manufacturers are entitled for the period. The government agencies shall not be eligible for subsidy under these rules, however, Agriculture Research Institutes may avail the same.

Copyright Business Recorder, 2020

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