Taxation measures given legal backing

The National Assembly has given legal cover to taxation measures for collecting Federal Excise Duty from June 13, 2013 on cigarettes, oilseeds/locally produced oils, all kinds of financial services and cars of 1800cc or above. The National Assembly here on Thursday also gave legal backing to the collection of the FED on hydraulic cement from June 13, 2013 and collection of sales tax on the basis of printed retail price from June 13.
All such measures to collect FED through the amendments to the Finance Bill 2013 have been made effective from June 13, 2013. When contacted, officials said the present three-tier structure of federal excise duty on cigarettes, based on a mix of ad valorem and specific rates, has been replaced with a two-tier structure having specific rates of duty. For this purpose, S. No 9 and 10 of Table 1 of the First Schedule to the Federal Excise Act, 2005 are being replaced, and S. No 11 is being deleted. Sates tax shall remain chargeable on cigarettes at standard rate (now 17 percent) on the basis of printed retail price. These changes are effective from June 13, 2013.
In order to promote fuel conservation, federal excise duty @ 10 percent has been imposed on imports and local supply of large vehicles above 1800 cc capacity. For this purpose, a new S. No 55 has been added in Table I of the First Schedule to the Federal Excise Act, 2005. The amendment is effective from June 13, 2013.
The exemption from federal excise duty on hydraulic cement has been withdrawn by deleting S. No 5 from Table-I of the Third Schedule to the Federal Excise Act, 2005. Thus such hydraulic cement is chargeable to duty with effect from June 13, 2013, sources said. Sources said that the Third Schedule to the Sales Tax Act, 1990 has been expanded by adding a number of additional items chargeable to sales tax on the basis of retail price. This measure applies to supplies made on or after 13th June, 2013. It may be noted that under sub-section (2) of section 3 of the said Act, in case of goods specified in the Third Schedule, the retail price along with the amount of sales tax is required to be legibly, prominently and indelibly printed or embossed on each article, packet, container package, cover or label, as the case may be. In order to allow consumption of existing stocks of packing materials by manufacturers, a General Order is being issued. However, it is emphasised that supplies of all such goods are chargeable to sales tax on the retail price with effect from June 13, 2013.
Sources added that Federal excise duty @ 16 percent has been imposed on all financial services as specified in PCT Heading 98.13, whether rendered or provided by banking companies, non-banking financial institutions and other persons. For this purpose, S. No 8 of Table II of the First Schedule to the Federal Excise Act, 2005 has been substituted. Now financial services such as "Easy Paisa", private modarabas, asset management companies, foreign exchange dealers, ATM withdrawal fee, etc, shall be subjected to federal excise duty. The exemption from FED to services provided by Asset Management Companies is being withdrawn by deleting S. No 8 of Table II of the Third Schedule to the Federal Excise Act, 2005. These amendments are effective from June 13, 2013.