30 May 2011

Pakistan Steel Industry for Checking up Check Posts:

Islamabad — The Steel Industry has requested the government to establish Federal Board of Revenue (FBR) check posts at Attock bridge or motorway entrance to charge Rs 4,500 sale tax per ton of steel consignment, arriving Punjab from Fata, it was learnt. Sources said that a Committee was constituted by the Engineering Development Board (EDB) on Steel Sector to solicit proposals for budget 2011-12.

To finalise the recommendations for the next budget which have now been formally submitted to the government, the committee held a number of meetings with all the stakeholders –
  • Pakistan Steel Melters Association (PSMA),
  • Pakistan Shipbreaking Industry (PSBA) and
  • Pakistan Steel Re-Rolling Mills Association (PSRMA)

One of the major recommendations of steel sector was to take necessary measure to ensure that all the goods produced by steel units in Fata are subject to tax upon reaching the local market. The reason behind the proposal given by the Steel Sector was that the furnaces established in Federal Administered Tribal Areas (Fata) were not paying Rs 6 sales tax on consumption of per unit electricity which makes them more competitive than tax paying units.

The PSMA claim was that such (Fata) units are selling their billets in Islamabad and Lahore markets and are hurting their market and convinced the committee on proposal that steel furnaces established in Fata should be subject to sale tax on selling their products in Punjab. The committee proposed that Federal Board of Revenue (FBR) should set up a check post at Attock Bridge/Motorway entrance to ensure that consignments from steel plants in Fata arriving Punjab and Islamabad are charged sales tax @ Rs 4, 500/per ton.

The Committee also requested that the special procedure of sales tax should continue on the same principles as are currently in practice. However, the enforcement of SRO 678 needs to be monitored more effectively to ensure that it is followed in true letter and spirit. It was proposed that a monitoring committee as proposed in the SRO 678 to be constituted and no sales tax return be admissible until or unless authenticated by the relevant association.

Any new melter or re-roller applying for registration of sales tax should be registered immediately and relevant information should be passed on to the concerned DISCO so that their sales tax liability be discharged properly through their electricity bills as per SRO 678.

Any stay order should not exceed a period of 6 months and should be resolved; failing which, it would be mandatory on a taxpayer to resolve the issue with ADRC within 3 months. The value of re-roll able import scrap may be fixed at 290 dollars per ton as all the value of other raw material is fixed.

Source: Pakistan Observer.

No comments: