ISLAMABAD: Federal Board of Revenue (FBR) has rejected to reduce customs duty on import of gold because the matter is under purview of Parliament.
This was the upshot of a second meeting of the committee on gems and jewellery constituted by the Prime Minister. Additional Secretary Industries and Production, Khizar Hayat Khan, presided over the meeting and reviewed the decisions taken during the first meeting held on November 1, 2013. The representatives of Ministry of Commerce and Ministry of Finance did not attend the meeting.
The following issues relating to FBR were also deliberated upon: (i) Withholding Tax on gold for commercial purposes be reduced from 1% to ad valorem Rs 15/gm; (ii) reducing the rate of advance income tax on pearl, Synthetic Stones, Precious/Semi-precious stones and diamonds from 5% to 1%; (iii) a fast-track hassle-free customs clearance; and (iv) zero-rated import of jewellery manufacturing machinery, equipment & consumables in line with zero-rated import of gemstone machinery and equipment.
FBR Secretary Export Policy briefed that jewellery manufacturing machinery, meant for export of jewellery has already been exempted from normal tariff and taxes vide SRO. No 670(1)/2013; however, the chairperson of PGJDC and CEO requested that the same facility may also be extended across the board to and for the jewellery manufacturing for local customers and to minimise import of jewellery. It was also suggested that withholding taxes on import of gold for commercial purposes should be reduced from one percent to Rs 15/gm at ad valorem.
Secretary FBR apprised the committee that it is not in the purview of FBR to curtail duty until and unless it is allowed by the Parliament; therefore, he suggested that the matter be considered as a budgetary proposal. CEO PGJDC explained the problem and difficulties being faced by the importers and exporters at the airport and suggested that FBR may provide some facilitation centers to ensure hassle-free customs clearance to remove concerns of exporters and importers of jewellery.
Secretary, FBR, replied that security matters are not related to FBR. The CEO PGJDC requested Secretary FBR that tax rebate availing by the textile sector may also be provided to exporters of jewellery sector. The proposal was taken by the Secretary FBR for due consideration.
