ISLAMABAD: The Federal Board of Revenue (FBR) is carrying forward the process of analyzing the budgetary proposals made by Pakistan Steel Melters Association (PSMA).
In this regard, sources told Customs Today that a team of the FBR was of the view that fewer proposals are acceptable as the acceptance of all the proposals could result in lowering revenue collection as well as would be harmful for the local industry.
The source said that that PSMA had moved proposal that at present imported billets were cheaper as compared to locally produced billets and this was only due to higher sales tax on the local production. More over, the prices of steel in the international market have crashed down. Therefore, sales tax of Rs 9 per electricity unit should be reduced to Rs 4 per electricity unit.
Furthermore, another proposal is about the advance sales tax of Rs 5,600. The source said that another proposal was about the 5 percent RD on import of the steel and iron scrap has been imposed in February 2015. The FBR levied it without taking the stakeholders into the confidence and it fielded the steel melting sector against ship breaking sector. Therefore, the PSMA has appealed for the removal of industrial raw material, 5 percent RD from import of steel scrap.
The source said that surge in import billets and finished goods forum china and other countries were seriously affecting the very survival of steel malign industry of Pakistan. Furnaces are being closed being non-competitive.
Keeping in view the above facts, FBR levy 15% RD on import billets which should be enhanced to 40%. It is requested that this imposition be levied across the board on all steel finished products being imported into the country. Sales tab be increased from 17% to 35% on imported finished goods. Levy of 2% customs duty on import of scrap also needed to be reviewed and abolished.
The source observed that income tax on steel units should be fixed Rs 0/50 per electric unit and to be paid in cash electricity or adjusted from advance income tax paid or refunds. This should be full and final liability. Steel units should be exempt from audit under various sections.
Smuggling of finished and semi finished steel goods through Taftan and Torkhum Borders are of great concern. Earnest efforts are required to put a stop to this smuggling through land routes. This will help save our local industry.
