ISLAMABAD: The Federal Board of Revenue (FBR) has proposed a new scheme under the name of Export Promotion Scheme after merger of the DTRE, EOU, manufacturing bonds and temporary imports in Budget 2021-22.
The existing schemes would be phased out in the next two years.
The scheme has been announced despite the fact that various export associations strongly recommended comprising a committee to take the point of view of major stakeholders to sit with the FBR officials to remove the various ambiguities and anomalies in the draft notification.
According to the Finance Bill 2021-22, released here on Friday, June 11, 2021, a big change has been proposed to merge all the export-oriented zero-rated schemes in the name of simple unified scheme instead of Manufacturing Bond, DTRE Scheme under SRO 450(I)/2001, SRO 326(I)/2008, and SRO 327(I)/2008, and temporary importation under SRO492(I)/2009 of the Customs Act, 1969.
The FBR proposed the new unified Export Promotion Scheme in Finance Bill 2021-22, to facilitate the exporters specifying the following features:
• The EPS introduced the categories of exporters as manufacturers-cum-exporters with 60 percent or above in Category A; manufacturers/exporters with less than 60 percent or exporters having more than three years of export history in Category B1; manufacturers/exporters having less than three years of export history.
Category B-2: Indirect exporter and commercial exporters in Category C.
• The import authorisation can be issued for the maximum period five year for Category-A, four years for Category B, and two years for Category C.
• All the existing users except commercial exporters, of any of export schemes issued under SRO 450(I) 2001 dated 18.06.2001 Chapter XV, DTRE, SRO 327(I)2008 dated 29.03.2008, before issuance of these rules shall be eligible to be classified under Category A.
• The Regulatory Collector can suspend or cancel the facility on any information, audit, or snap checking besides any other action as provided under the law.
• The exporter shall be allowed to sell 20 percent of the output goods manufactured from input goods in the domestic market on payment of leviable duty and taxes on filing of a goods declaration, which shall be assessed as if goods are imported into Pakistan in that condition.
• No wastage of input goods in terms of quantity, volume weight or number, as the case may be, shall be allowed except as determined in the analysis certificate, and no duty and taxes shall be charged on such wastages of the input goods.
• The exporter will have no need to go to the IOCO again and again for determination, once has been done and issued an analysis certificate.
The IOCO maintains the centralised data base of input/output ratio and wastage.
• The Directorate of Post-Clearance Audit shall conduct an audit of the users.
The Finance Bill 2021-22 also proposed to insert the new clause in Fifth Schedule of the Sales Tax Act, 1990 that the local supplies of raw materials, components, parts and plant and machinery to registered exporters authorised under Export Facilitation Schemes 2021 notified by the Board with such conditions, limitations, and restrictions.
The Member-Customs Policy, FBR committed with exporters in meetings that they will open the further offices of the Directorate of IOCO and the Directorate of Post Clearance Audit to facilitate the exporters in other cities specifically in Islamabad, Faisalabad, Sialkot, and Multan, as already there are only two offices in Lahore and Karachi.
Copyright Business Recorder, 2021
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