The Ministry of Communication is understood to propose to the Economic Coordination Committee (ECC) of the Cabinet for reduction in customs duty on import of petroleum bitumen from 15 percent to 5 percent.
Sources told Business Recorder on Friday that the Ministry is not satisfied with the 10 percent decrease in duty on petroleum bitumen/asphalt in budget 2007-08, from 25 percent to 15 percent. The government has also abolished excise duty on petroleum bitumen, facilitating rapid increase in its production and supply.
The Ministry has been actively engaged in consultation with the economic ministries and Revenue Division for minimising duty structure. According to a summary for the ECC, prepared by the Communication Ministry, there is an acute shortage of bitumen, which is hindering completion of highway projects in the country. Slashing duty from 15 to 5 percent would make the much-needed raw material compatible with natural refiners, engaged in its supply.
Despite duty reduction from 25 to 15 percent, the cost of imported petroleum bitumen is still Rs 4000 higher per metric ton (PMT) than its local production after payment of duties and taxes. Presently, 15 percent duty is applicable on the import of petroleum bitumen falling under Pakistan Customs Tariff heading (PCT) 2713.2000.
The demand of bitumen is substantially increasing in view of on-going infrastructure projects in almost all the cities. There is a major different between the imported and locally produced bitumen, which needs to be brought at par atleast by further reducing duty on its import, sources added.
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