ISLAMABAD: The computer industry has shown serious concerns over the Federal Board of Revenue’s (FBR) decision of not removing a sales tax anomaly in computer industry through Finance Bill 2017.
The computer industry had proposed to the FBR to abolish 17 percent sales tax on such parts in the budget 2017-18 to practically benefit from last year’s concessions of zero-sale tax regime on imports and supply of computer/laptops.
The anomaly has not been removed and Finance Minister Ishaq Dar should immediately ask the FBR to review the status of sales tax on computer industry to ensure uniform treatment of sales tax exemption on raw materials as well as finished products, sources said.
According to the budget proposals of the industry submitted to the FBR for 2017-18, the FBR had granted exemption from sales tax to laptops and personal computers in last budget to promote genuine imports and render informal and illegal imports as uncompetitive. However, the parts/component assembled inside the computers remained subject to 17 per cent sales tax. This has created a serious distortion in the system and actual benefit of the concession has not been available to the computer vendors. In order to remove the distortion, the FBR must abolish 17 per cent sales tax on component parts assembled inside the computers in budget 2017-18.
