The Commerce Division has allowed duty drawback of taxes collected from gloves @ 7 percent, footballs and other sports goods @ 7 percent, leather garments including articles of leather and manufacturers thereof @ 7 percent, other leather manufacturers @ 7 percent, foot wear @ 7 percent, leather tanned and finished leathers excluding wet blue hides and skins (4104, 1100/1900. 4105, 1000 and 4106.2100) @ 5 percent, surgical goods/medical instruments @ 5 percent and cutlery @ 5 percent.
The SRO 1062 (1)12017 issued on Thursday stated that in exercise of the powers conferred by sub-section (1) of section 3 of the Imports and Exports (Control) Act, 1950 (XXXIX of 1950) and in pursuance of its Notification No. SRO 62(1)1 2017, dated the 2nd February, 2017, the federal government is pleased to make the following order, namely Drawback of Local Taxes and Levies (Non-Textile) Order, 2017.
According to the notification, it extends to the whole of Pakistan including export processing zones and shall come into force at once. The drawback under this Order shall be provided for the shipments made from the 1st July, 2017 to 30th June, 2018 as under: (a) fifty percent of the rate of drawback shall be provided without condition of increment; (b) remaining fifty percent of the rate of drawback shall be provided, if the exporter achieves an increase of 10% or more in exports during financial year 2017-18, as compared to the financial year 20 16-17; (c) the actual rate of drawback against clause (b) shall be determined on the basis of annual performance of the exporter, but in order to improve his cash flow, the disbursement against clause (b) shall be allowed on the performance during July-December, 2017, subject to submission of a bank guarantee that the exporter shall return the excess amount, in case his annual exports are less than the eligibility criteria stipulated in clause (b); d) an additional 2% drawback shall be allowed for exports to non-traditional markets ie Africa, Latin America, non-EU European countries, Commonwealth of Independent States and Oceania on the same conditions as at clauses (a) and (b).
The drawback shall be provided to units on exports of products under specific tariff codes of the Pakistan Customs Tariff. The drawback shall be available only to units. The export performance in case of drawback specified in clause (b) of sub-paragraph (4) of paragraph I shall be analyzed separately for each category of eligible products. Exports shall be calculated on the basis of shipment date. Only those exports shall be eligible for the drawback claim, proceeds of which have been fully realized. However, the date of realization shall have no bearing in determining the year, in which the transaction shall be accounted for,
The unit availing the drawback shall be a registered sole proprietor, partnership or a company, having valid NTN and shall be a member of respective association or chamber registered with the DGTO, Ministry of Commerce and Textile. The unit shall furnish data and any information related to its operations, domestic sales, accounts and exports as and when required by the Ministry of Commerce and Textile.
The procedure for submission of claims shall be issued by SBP in consultation with Ministry of Commerce and Textile through circular. For implementation of clauses (a) and (d) of sub-paragraph (4) of paragraph 1: (a) the authorized dealers shall scrutinize the claim as per procedure circulated by SBP, if found in order, and claim the amount from SBP for onward credit to the unit. The whole procedure shall be completed within fortnight from the receipt of the claim; (b) the SBP shall release the amount of claim to the authorized dealers within forty-eight hours after receipt by debiting the relevant government head of account; (c) the authorized dealer shall credit the amount of claim received from SBP within twenty-four hours to the unit.
The SBP shall issue a separate circular for implementation of clauses (b), (c) and (d) of sub-paragraph (4) of paragraph 1, in consultation with the Ministry of Commerce and Textile.
The receipt of drawback payments shall be properly reflected in the books of accounts or balance sheets of the unit. The SBP shall conduct verification of claims on sample basis. The procedure of sampling shall be issued by the SBP. The federal government or person authorized by it reserves the right to conduct periodical, random, on the spot checks and audits to verify the claims filed and drawbacks received by the units under this order.
Penalty for Contravention: Where any unit or authorized dealer or other person contravenes any provision of this Order, he shall be liable for punishment in accordance with the provisions of the Imports and Exports (Control) Act, 1950 (XXXIX of 1950) and the rules and orders made there under without prejudice to any other law for the time being in force.
The list of non-traditional markets included South Africa, Egypt, Algeria, Morocco, Nigeria, Tunisia, Ethiopia, Keya, Ghana, Angola, Liberia, Libya, State of, Cote d''Ivoire, Tanzania, Namibia, Botswana, Senegal, Mozambique, Zimbabwe, Cameroon, Uganda, Mauritius, Congo, Djibouti, DR Gongo, Zambia, Burkina Faso, Guinea, Mall, Madagascar, Benin, Mauritania, Somalia, Gabon, Niger, Rwanda, Togo, Swaziland, Lesotho, Malawi, Equatorial Guinea, Sierra Leone, Seychelles, Burundi, Chad, Cabo Verde, Comoros, Central African Republic, Gambia, Guinea-Bissau, Eritrea, Sao Tome and Principe, Sudan, South Sudan, Western Sahara, Saint Helena, Reunion, Mayotte.
The Latin America countries included Mexico, Brazil, Chile, Argentina, Colombia, Peru, Panama, Guatemala, Ecuador, Dominican Republic, Costa Rica, Venezuela, Bolivarian Republic of, El Salvador, Paraguay, Bolivia, Uruguay, Honduras, Bahamas, Cuba, Nicaragua, Trinidad and Tobago, Jamaica, Cayman Islands, Haiti, Guyana, Barbados, British Virgin Islands, Aruba, Belize, Suriname, Saint Lucia, Antigua and Barbuda, Saint Vincent and the Grenadines, Turks and Calicos Islands, Saint Kitts and Nevis, Grenada, Dominica, Falkland Islands (Malvinas), Anguilla and Montserrat.
Commonwealth of Independent States (CIS) included Ukraine, Belarus, Kazakhstan, Uzbekistan, Georgia, Azerbaijan, Turkmenistan, Moldova, Republic of, Kyrgyzstan and Tajikistan.
Oceania included Australia, New Zealand, Marshall islands, Papua New Guinea, Fiji, new Caledonia, French Polynesia, Solomon Islands, Vanuatu, Samoa, Tonga, Micronesia, Federated States of, Palau, the Cook Islands, Northern Mariana Islands, Kiribati, Tuvalu, Nauru, American Samoa, Norfolk Island, Christmas Island Wallis and Futuna Islands, Niue, Cocos (Keeling) Islands Tokelau, Pitcairn and Guam. The non-EU European countries included Albania, Belarus, Gibraltar, Iceland, Kosovo, Lichtenstein, Macedonia and Norway.
Copyright Business Recorder, 2017