ISLAMABAD: Federal Board of Revenue (FBR) on Thursday imposed federal excise duty (FED) on locally manufactured cars and SUVs having engine capacity exceeding 1700cc or above.
As per the FBR’s budget instructions issued to the field formations, the S. No. 55 of Table-1 of the First Schedule to the FED Act 2005 has been amended.
“Duty of the imported motor vehicles of 1800 cc to 3000cc has been enhanced to 25 per cent ad val. A new S. No. 55A has been inserted whereby the rate of federal excise duty has been enhanced to 30% ad valorem on the import of motor cars, SUVs and other motor vehicles of cylinder capacity of 3000cc or above”, newly issued FBI’s budget instructions stated.
In order to ease understanding for the citizens, the revenue board also released a drafted summary.
At the same time, field formations are requested to consult the provisions of Finance Supplementary (Second Amendment) Act, 2019 for proper appraisal of the measures introduced.
The proposed summary of the measures under these tax laws is given below:
“To liquidate huge amounts claimed by taxpayers in refunds which have been accumulated over a long time, the government has decided to pay the same through sales tax refund bonds, which shall have a maturity period of three years. Simple profit at 10% per annum is also proposed to be paid. The claimants shall also be able to raise the much-needed cash by selling these notes in the security market. A new Section 67A has been inserted in the Sales Tax Act 1990 to include enabling provisions for payment of refund in this manner and also to provide for regulatory mechanism relating to issuance, transfer, redemption and other related matters.
In Serial No. 110 in Table 1 to the Sixth Schedule of STA 1990, already available exemption of sales tax in relation to plant, machinery and equipment required for power generation from renewable sources of energy has been guaranteed up to 30th June, 2023, to provide for certainty and confidence to investors. Same protection has been ensured on the import side of the similar equipment as covered under S. No. 7 and S. No. 14A in Table 3 of the Sixth Schedule.”
FBR added that keeping in view the difficulties being faced by cancer patients and also on the orders of the Supreme Court, items relating to ostomy procedures for treatment of cancer patients, which were not expressly and exhaustively mentioned in the Sixth Schedule to the Sales Tax Act, 1990, have now been so covered by substituting Sr. No. 117 and relating it to heading 99.25 in the First Schedule to the Customs Act.
