To facilitate tea manufacturers of famous brands, the Federal Board of Revenue (FBR) has exempted tea manufacturers from fixation of retail price of imported raw tea for the purpose of calculation of sales tax. The FBR has issued Sales Tax General Order number 104 of 2019 Friday. Now, raw tea, which is not in retail packing, shall be assessed on the basis of average retail price as declared by such tea manufacturers.
According to the FBR, the recognized tea manufacturers of well-known tea brands have approached FBR regarding difficulties in fixation of retail price of imported raw tea on the ground that that it is not possible to determine retail price at the time of import because of different SKUs (in term of varieties of blend, size, packing) of team manufactured by them from such imported raw tea.
Acknowledging, the difficulty as pointed out, the Board is pleased to direct that the raw tea, which is not in retail packing, shall be assessed on the basis of average retail price as declared by such manufacturers and certified by concerned Chief Commissioner on the basis of past sales of each manufacturer. However, such average retail price shall not be, less than the limit as stipulated in para 9ii) of the STGO 103 of 2019 dated September 7, 2019.
It is clarified that the balance amount as worked out after production will be paid with return. It is also clarified that no adverse inference shall be drawn by the department on account of such declaration of retail price, as made at import stage, being different from final retail price as determined/fixed by the manufacturer at local supply stage, the FBR added.