ISLAMABAD, Jun 9 (APP):Following are the proposed budgetary revenue and relief measures pertaining to Sales Tax and Federal Excise Duty (FED) for FY 2023-24:
-Extension in exemption of sales tax to NMDs (FATA/PATA) for another one year ending 30.06.2024.
-Grant of exemption of sales tax on contraceptives and accessories.
-Grant of exemption of sales tax on plant saplings, combine harvesters, dryer for agricultural products, no-till-direct seeder, planters, trans-planters, other planters AND bovine semen.
-Grant of exemption of sales tax on import of IT equipment by exporters of IT and ITeS registered with Pakistan Software Export Board.
REVENUE MEASURES:
-Withdrawal of exemption of sales tax on edible products sold in bulk under brand names or trademarks.
-Enhancement in reduced rate of sales tax from 12% to 15% on supplies made by the POS retailers dealing in leather and textile products.
STREAMLINING MEASURES:
-The requirement of shop area for tier-1 retailers is proposed to be withdrawn.
-The Directorate General of Digital Invoicing and Analysis is proposed to be renamed as -Directorate General of Digital Initiatives.
-The scope of penal action is proposed to be enhanced by substituting the “cigarette packs” with “goods specified by the Board”.
-S. No. 12(xxv) of Fifth Schedule is proposed to be amended by substituting the current description with the “Other drawing, marking out or mathematical calculating instruments (geometry box) (PCT heading 9017.2000)”.
-Scope of S. No. 21 of Fifth Schedule providing zero-rating to exporter registered under Export Facilitation Scheme, 2021 is proposed to be enhanced by inserting the word “commodities”.
-For the purpose of clarification regarding exemption of sales tax on transfusion sets not packed in the aluminum foil imported in one consignment with the blood bags, explanation is proposed under S. No. 121 of Table-1 of the Sixth Schedule.
-Omission of S. No. 159 and 160 of Table-1 of the Sixth Schedule is proposed being redundant as the time bound exemption has already expired on 31.12.2021.
HARMONIZATION MEASURES:
-Production, transmission and distribution of electricity is proposed to be excluded from the purview of sales tax in accordance with the decision of the National Tax Council.
Federal Excise Duty
The proposed budgetary measures pertaining to Federal Excise Duty (FED) for FY 2023-24 are:
-Imposition of FED on energy inefficient fans @ Rs. 2000 per fan and incandescent bulbs @ 20% ad valorem is proposed as approved by the Federal Cabinet in Case No. 01/01/23, dated 03.01.2023.
-The scope of FED on services is proposed to be enhanced by adding royalty and fee for technical services.
STREAMLINING MEASURES:
-New clause (e) of sub-section (1) of section 3 is proposed to be added which will elaborate further the chargeability of federal excise duty on goods and services.
-The Directorate General of Digital Invoicing and Analysis is proposed to be renamed as Directorate General of Digital Initiatives.
-The procedure for publication of general orders and departmental instructions and ruling of the Board on its official website are proposed to align with provisions under the Sales Tax Act, 1990.
