The Federal Board of Revenue (FBR) is likely to announce new tax incentives for construction and manufacturing sector with possible abolition of customs duty slab of 25 percent in budget (2015-16). Sources told Business Recorder here on Sunday that the concessions to the construction and manufacturing sector are the priority of the upcoming budget. Duty concessions at the import stage are expected for the said sectors.
The FBR may bring items falling under the Pakistan Customs Tariff headings of 25 percent to the 20 percent slab. In case 25 percent slab has been abolished, the items may be subjected to lower rate of 20 percent duty.
The FBR would reduce the number of general tariff slabs of Pakistan Customs Tariff (PCT) from 6 to 5 percent in coming budget (2015-16) and maximum general slab of 25 percent would also be brought down under tariff rationalisation plan. Last year maximum general slab of 30 percent has been reduced to 25 percent. The maximum tariff slabs were also reduced from 7 to 6. In next budget (2015-16), tariff slabs would be reduced from 6 to 5 percent and peak slab may also be brought down from 25 percent to a lower level of 20 percent. If the customs tariff slab would be reduced to five by abolishing 25 percent slab, the items subjected to 25 percent would be charged to reduce rate of 20 percent duty.
In continuation of the customs tariff rationalisation plan, budget makers are reviewing the proposal to reduce customs duty slabs in next budget.
The concessionary tariff on locally produced inputs viz raw materials, components, sub-components and machinery would be withdrawn in phase wise manner, they added.
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