The proposed enhanced rate of 2 percent special excise duty (SED) would not be applicable on a large variety of essential goods like basic food items, edible oil, fertilisers, pesticides, pharmaceuticals, medicines, electricity, natural gas, POL products, iron/steel items and computers.
Sources told Business Recorder here on Saturday that the one percent special excise duty, which was being levied since July 2007 on notified categories of non-essential imports and domestic manufactures, such as air conditioners, beverages, cigarettes, cosmetics, deep freezers, detergents and motor cars etc, shall be enhanced to 2 percent, up to June 30, 2011. This excise duty shall continue to be exempt on a large variety of essential goods like basic food items, edible oil, fertilisers, pesticides, pharmaceuticals, medicines, electricity, natural gas, POL products, iron and steel items and computers, etc.
They said that the enhanced rate of the special excise duty would be applicable on notified categories of non-essential imports and domestic manufactures, such as air conditioners, beverages, cigarettes, cosmetics, deep freezers, detergents and motor cars, etc up to June 30, 2011.
They said that the SED would not be applicable on vegetables, seeds, edible oil, POL products, natural gas/LPG, electricity, phosphoric acid, pharmaceutical products, fertilisers, gold and silver, tin plate, computer hardware, bitumen, currency notes as well as items classified in Chapter 99 of Pakistan Customs Tariff and temporarily imported goods under the Duty and Tax Remission for Exports (DTRE) scheme. Moreover, items on which sales tax is zero-rated shall also not be liable to special excise duty. This levy would also be not applicable on the imported goods subject to customs duty at the rate of zero-percent under Customs Act or any notification issued thereunder.
The special excise duty would not also be applicable on the supplies made by the cottage industry and goods produced for subsequent export by the manufacturers.
Exception from SED would be applicable on imports made by privileged personnel/organisations under grant-in-aid agreements; goods imported by various agencies of the United Nations; diplomats/embassies; household articles including vehicles and goods for donation to projects established in Pakistan, imported by the rulers and dignitaries of UAE and Qatar.
As per SED-related notifications issued in the past, sources said, the special excise duty would not be applicable on goods supplied free of cost as replacement of identical goods previously imported; goods imported into and exported (except to tariff area of Pakistan) from the Export Processing Zones and any enactment relating to Gwadar Special Economic Zone and the levy would not be applicable on un-cut precious and semi precious stones; polished semi-precious stones; jewellery casting powder; moulding rubber; injection wax; jewellery casting machines and accessories; rhodium-plating solution concentrate; bright and chrome lacquering solution; steel balls and pins (different sizes) used for polishing; diamond cutting tools; alloys of silver copper and zinc for mixing in 24 ct. gold; mounts and findings of gold, silver and platinum jewellery and ground handling equipment, service and operation vehicles, catering equipment and fuel trucks not manufactured locally, imported by domestic airlines or by any other service company to which a licence has been issued by the Civil Aviation Authority.
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