ISLAMABAD: The Federal Board of Revenue (FBR) has sent a note to the Finance Ministry to move a summary to the federal cabinet to increase central excise duty on import of edible oil, vegetable ghee and cooking oil from 15 percent to 20 percent to the extent of the Federally Administrated Tribal Areas (FATA) and Provincially Administrated Tribal Areas (PATA).
The main objective of increasing central excise duty on edible oil, vegetable ghee and cooking oil is to provide a level playing field to the oil and ghee manufacturers of tariff areas vis-a-vis their counterparts of non-tariff areas.
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“However, the FBR has been of the opinion that in view of the peculiar circumstances in PATA/FATA, some protection has to be provided to industry set up there,” sources at FBR told Customs Today.
“In this regard an SRO 333 (1) /2002 dated June 15, 2002 will have to be amended” the sources said, adding that SRO had been issued by the federal government and therefore, any amendments in the said SRO required approval of the Federal Cabinet including Prime Minister within the meanings of article 90 of the constitution as has been held by the Supreme Court of Pakistan in case reported as PLD 2016 SC 808.
The sources told that prime minister in his capacity as Federal Minister-in-charge of Finance, Revenue and Economic Affairs had approved submission of summary to the federal cabinet and mandated the Cabinet Committee for Disposal of Legislative Cases (CCLC) to dispose of cases relating to rules to be framed/ amended by the federal government.
Moreover, the sources said that a summary had been submitted to Cabinet Committee for Disposal of Legislative Cases (CCLC) for increase in rate of central excise duty from 15% to 20% on import of edible oil, vegetable ghee and cooking oil. Pursuant to approval of CCLC, a separate summary shall be submitted to federal cabinet for obtaining approval to the proposal.
It is pertinent to note here that Senate has recommended in the Finance Bill 2017 that CED on edible oil should be increased from 16% (although actual rate of central excise duty is 15%) to 21.5% as well as 1% income tax should be imposed on industry at import stage, which should be final tax liability.
