The Federal Board of Revenue (FBR) has decided to process all unpaid claims of special excise duty (SED) drawbacks paid on export following clearance of the Sales Tax Automated Refund Repository System (STARR), a system used for processing sales tax refund claims.
In this connection, the FBR issued instructions to all Chief Commissioners of the Large Taxpayer Units (LTUs) and Regional Tax Offices (RTOs) on Wednesday. According to the FBR instructions to the field formations, Chief of STARR refund system has given following remarks for clearance of unpaid claims of SED drawbacks paid on exports. "Drawback of SED system was implemented at all the RTOs/LTUs in August, 2008. RTOs/LTUs may be advised to process their claims. In case of any problem, please co-ordinate with local PRAL representative.". Keeping in view the remarks of the Chief of STARR, the FBR has clarified that the unpaid claims of SED drawbacks paid on exports may be processed in light of the above clarification by Chief of STARR, FBR said.
Through another clarification, the FBR informed all Chief Commissioners of the LTUs/RTOs that the FBR has already issued instructions to all field formations vide letter of January 12, 2011 to process the pending refund/drawback claims of 1 percent Special Excise Duty. The case of refund claim of 1 percent Special Excise Duty of Chenab Limited may be processed as per law in light of FBR's aforesaid letter.
In case of any problem, local PRAL representative may be contacted, the FBR added. Responding to FBR's clarification, a tax expert said that the FBR clarification would facilitate the exporters in obtaining drawback of the special excise duty (SED) paid on exports.