The Federal Board of Revenue (FBR) has waived income tax leviable on exports originating from the areas affected by war against terrorism. Sources in customs department told Business Recorder on Saturday that exports of the most and moderately affected areas would be exempted from income tax till the end of the next financial year.
They said that the Prime Minister has directed the concerned agencies to provide fiscal relief to rehabilitate the economic life in NWFP, FATA and PATA. Therefore, initiatives were made to rehabilitate business activities in areas which have been badly hit by war against terrorism.
They said that FBR is also playing its role in this relief package by providing tax relief to the taxpayers of affected areas, and added that the fiscal concessions in respect of sales tax could not be extended to the districts/areas of FATA, PATA and Chitral where sales tax laws have not so far been extended. In the remaining parts of the province, maximum relief, in principle, should be extended.
They said the entire amount of penalty and default surcharge liable on the registered persons/importers or any other business entities on account of customs duty, sales tax or excise duty and income tax would be withdrawn, if the principal amount is paid by June 30, 2010. They said the board has also decided to give income tax and sales tax exemption on electricity consumption to all registered and unregistered manufacturing units of the most and moderately affected areas.
Besides that, the payment of duty drawback of sales tax admissible on exports of these areas would be made within three days. Moreover, sources said, the federal excise duty (FED) on goods produced and services rendered in FATA & PATA would completely be exempted while it would be 50 percent in moderately affected areas from January 1, 2010 to June 30, 2010.
They said that the rate of domestic sales tax on goods manufactured and supplies made in these affected districts would be reduced by 50 percent of leviable rate. They added that recovery of outstanding arrears of income tax, sales tax and excise duty, etc, would also be allowed through easy instalments over a period of three years as per agreed terms and conditions.