ISLAMABAD: The Federal Board of Revenue (FBR) has imposed new conditions for the user holding contracts for toll manufacturing on the import of input goods.

The FBR has issued SRO 514(I)/2022 to amend the existing procedure for international toll manufacturing laid down under rule 885 of SRO 957(I)/2021 dated 30/7/2021.

According to the procedure, a user holding a contract for toll manufacturing may import input goods directly or indirectly from the foreign principal without involving any remittance of foreign exchange.

The user shall provide I-Form of nil remittance value for input goods duly approved by the concerned authorized dealer, new procedure revealed.

At the time of import, the system shall debit the revolving insurance guarantee balance of the importer or accept the Indemnity Bond and Post Dated Cheque, as the case may be, for an amount equivalent to the duties and taxes leviable on the imported goods.

After the production of the output goods, the user shall export the goods on submission of and E-Form equivalent to the service charges approved by the authorized dealer.

On realization of the foreign exchange equivalent to the service charges as per contract, the authorized dealer will certify and report the same to the State Bank of Pakistan on R-Form.

The revolving insurance guarantee furnished by the importer shall be credited by the system or the indemnity bond and post dated cheque shall be released, as the case may be, against certification from the authorized dealer to the effect that the foreign exchange equivalent to the service charges as per contract has been repatriated in the account of the exporter, the FBR added.

Copyright Business Recorder, 2022