New manufacturing units facilitated: Duty-free import of cryogenic oxygen tanks allowed

ISLAMABAD: The federal government has allowed duty-free import of cryogenic oxygen tanks to facilitate new oxygen manufacturing units in the country, sources in Ministry of Industries and Production told Business Recorder.

The Ministry of Industries and Production noted that earlier summary regarding import of oxygen gas, cylinders and cryogenic tanks, without payment of duty and taxes raised by the Ministry of Industries and Production was approved by the ECC vide case No ECC-274/29/ 2020 dated 22nd June, 2020 and subsequently ratified by the Cabinet in its meeting held on 23rd June, 2020. The incentives approved in the summary, relating to import of oxygen gas, oxygen gas cylinder and cryogenic tanks were applicable from 23rd June, 2020 for the period of three months and expired on September 22, 2020.

Due to the policy intervention and incentives, new oxygen manufacturing units had been setup in the country enhancing the installed capacity of oxygen manufacturing from 487 MT per day to 750 MT per day. The enhanced capacity needs to be complemented with additional cryogenic tanks required for storage and transportation purposes.

The manufacturers had requested Industries Division for duty-free import of cryogenic tanks in the country in order to ensure uninterrupted supply of oxygen gas at competitive rates.

Ministry of Industries and Production proposed that duty and tax-free import of cryogenic oxygen tanks (falling under respective headings of chapter 73 of Pakistan Customs Tariff) may be allowed to manufacturers of oxygen for a period of 90 days for better handling of Covid-19 induced situation.

The taxes and tariffs involved included 3% Customs Duty (CD), 17% General Sales Tax (GST) and Withholding Income Tax under Section 148 of the Income Tax Ordinance, 2001.

During the ensuing discussion, the secretary, Ministry of Industries and Production stated that all stakeholders who were consulted had agreed to the proposal. Only comments from Ministry of National Health Services & Regulation were awaited. He requested for comments from the secretary, Ministry of National Health Services & Regulations, who endorsed the proposal.

After deliberations and arguments of different stakeholders, the ECC approved the proposal of Ministry of Industries and Production.

Copyright Business Recorder, 2021