January 13, 2021 (MLN): Federal Board of Revenue has devised an Integrated Strategy which has contributed to significant increase in exports of Pakistan from US$ 1.6 Billion (in August 2020) to US$ 2.4 Billion (in December, 2020).
Growth in exports in December 2020 is up by 18.3 per cent as compared to US$ 1.993 billion in the corresponding month last year. Import duties on 1,623 tariff lines, pertaining to basic raw material and intermediate goods were reduced to zero through the Finance Act, 2020.
In pursuance of this strategy, additional customs duties, and regulatory duties on 164 items related to textile sector, not manufactured in the country, were also removed in collaboration with all the stakeholders.
All these measures were undertaken with the objectives of neutralizing adverse impact of COVID 19 Pandemic, especially for the exporters, and to make their products competitive vis-à-vis those of their competitors in the international market.
Under the initiative of “Make in Pakistan”, the Duty Drawback rates for at least eight (08) sectors were revised upwards by FBR. During the whole exercise, more than 434,000 claims were disposed of and approximately 7800 exporters have benefited from this Initiative.
FBR has paid 90percent more refunds of Sales Tax during July-Dec, 20 as compared to the corresponding period last year. This led to rise in volumes of exports in the form of increase in TEUs/Containers from 35,477 in July 2020 to 62,591 in December,20 showing growth of43%.
All the Export Facilitation Schemes were simplified /rationalized for their optimal use by the exporters. First of all, extension in utilization period of different export facilitation schemes was allowed for a period of one year from March 1, 2020 to February 28, 2021.
Secondly, retention period for plant and machinery, under the Export Oriented Units Scheme, was reduced from 10 years to five years.
Thirdly, for the prompt redressal of grievances, one administrative tier is reduced (under Duty and Taxes Remission for Export Scheme and Manufacturing Bond Scheme) and Regulatory Authority is created to facilitate the exporters.
Moreover, the investors in Export Processing Zones have been facilitated in payment of duties/taxes on the disposal of machinery in the tariff area.
These facilitation measures have led to increase in number of exports Goods Declarations (GDs) from 71,190 in July 2020 to 79,756 in December 2020, posting an increase of 11%.
In the same vein, total number of Exports Goods Declarations (GDs) (from July 1, 2020 to 31st December, 2020), remained at 408,472 vis-à-vis 333,943 during 1st January, 2020, showing an increase of 18%.
To realize the objective of facilitation / promotion of exports, an automated system of filing the claim to the final sanctioning of Duty Drawback Claims for the payment of Duty Drawback Claims to the exporter was rolled out on 1st October 2020.
As a matter of fact, export Goods Declaration filed in Customs WeBOC system is being considered as the Duty Drawback Claim. State Bank of Pakistan credits the system sanctioned payments in the accounts of exporters online directly.
In addition to the said automation initiative, Green Channel clearances of the exports GDs / Consignments were increased from 74% in July 2020 to 77.3 % in December 2020.
Similarly, for speedy payment of Sales Tax refunds to exporters, FASTER PLUS System has been implemented. FBR has also removed regulatory duty on import of cotton yarn, till 30th June 2021, which is a basic raw material for the value-added textile industry of Pakistan.
Being committed to the national goal of increase in exports, Federal Board of Revenue is making all out efforts to assist exporters by continuously making improvements in its laws and procedures.
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