The Federal Board of Revenue (FBR) has imposed regulatory duty (RD) on import of carbonless and wax papers. The board issued a notification on Friday to remove the anomaly and protect the local paper industry.
According to the notification, 5 percent RD has been imposed on the import of carbonless paper (PCT headings 4809.2000, 4809.9000) and 10 percent RD on the import of wax paper (PCT heading 4811.6010).
Sources told Business Recorder that Karachi Carbon and Ribbon Industries had approached the FBR, through anomaly committee constituted after announcement of the 2007-08 budget. Duty on offset paper, which is raw material for manufacturing of carbonless paper, was fixed at 20 percent while the duty on finished carbonless paper was reduced to 15 percent from 25 percent in 2007-08 budget.
The company had requested to reduce duty on offset paper and to revert the 25 percent duty on finished product ie carbonless paper (PCT headings 4809.2000, 4809.9000, 4816.9000).
Responding to the proposal, the FBR said that the rate of duty on carbonless writing paper was reduced from 25 percent to 15 percent on the recommendations of EDB. It is important to mention that the offset paper is common writing paper. The EDB had recommended 5 percent duty through SRO 565(I)/2006. The board is, however, of the view that pre-budget tariff rate of 25 percent may be restored by levying 10 percent regulatory duty.
The anomaly committee had decided that the duty on offset paper (4802.5510) should be reduced to 15 percent and levy 5 percent R.D on carbonless paper (4809.2000, 4809.9000). Sources stated that Metatex is manufacturer of wax paper.
It is of the view that white paper, which is used in the manufacture of wax paper, is at 20 percent to 25 percent customs duty and the finished product ie wax paper, has been reduced to 10 percent duty which will adversely affect the industry. The unit requested to raise the duty on imported wax paper to 20 percent.
The FBR responded that the duty on this item was reduced to 10 percent in 2007-08 budget on the recommendation of EDB which proposed to rectify the anomalous position by allowing 5 percent rate of duty on the inputs of offset paper under SRO 565(I)/2006.
The board is, however, of the view that pre-budget tariff rate of 20 percent on wax paper may be restored by levying 10 percent RD. The anomaly committee had recommended to impose R.D @ 10 percent on the import of wax paper (4811.6010).