The Federal Board of Revenue has extended period for retention of raw material, components and goods, used in the manufacturing of finished products to be exported under the Temporary Importation Scheme (SRO1065) from 12 months to 18 months. The FBR has amended SRO.1065 through a notification issued on Thursday to facilitate exporters.
Sources told Business Recorder that the FBR has implemented a major decision of the Trade Policy (2008-2009) to encourage exports. Under the Trade Policy, it was proposed that the period of retention of raw material and components for export under temporary importation scheme (SRO 1065) may be increased from current 12 months to 18 months ie at par with Duty and Tax Remission for Export Scheme (DTRE).
Now, the manufacturers-cum-exporters have been allowed to retain such imported inputs up to 18 months. Through amended SRO.1065, the FBR has introduced few new amendments to facilitate the exporters. The collectors of customs have been empowered to give six-month extension in such cases subject to one percent surcharge on cost and freight (C&F) value of the inputs/goods for which extension has been granted.
Under the previous language of the SRO, it was assumed that the one percent surcharge would be charged on the overall imported goods. However, it has been clarified that one percent surcharge would only be applicable on the remaining balance of imported goods for which time period extension has been sought by the exporter.
The remaining goods which were not being exported within the given time period would be liable to one percent surcharge in case of extension in retention period. It has also been clearly specified in the notification that FBR can give further extension in exceptional cases. This shows that the FBR has been empowered to give extension of unlimited time period, sources added.
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