ISLAMABAD: Adviser to the Prime Minister on Commerce, Textile and Industries Abdul Razak Dawood on Wednesday said the 10 per cent federal excise duty (FED) on locally manufactured cars and sports utility vehicles etc with engine capacity exceeding 1,700cc would be withdrawn.
Briefing the Senate Standing Committee on Industries and Production, the adviser said the decision of imposing FED on locally manufactured vehicles was being revisited.
Committee Chairman Senator Ahmed Khan said he had been informed by the government functionaries that the duty would be withdrawn next week or in the following one.
Meanwhile, in a briefing to the committee, Engineering Development Board mentioned that the auto sector was not consulted when this decision was made in the second mini-budget.
It was also highlighted that the sales of car and SUVs over 1,700 cc would decrease due to the imposition of the 10pc duty, which would eventually lead to a decline in government revenue. Besides, it was also a violation of Auto Policy 2016-21.
The committee was also informed about the report of ‘experts group’ regarding viable solutions and the future course for Pakistan Steel Mills (PSM) will be presented to ECC on April 8 and to the Ministry of Industries and Production on April 6.
He also added that six investors — three each from China and Russia — have expressed interest for the takeover of PSM, adding “but we have told everybody that we are open to all and there will be transparency in affairs.”
The cabinet will decide the future of PSM and whether to pursue revival or privatisation based on the experts’ report.
“The government has already placed PSM in the list of entities under the Privatisation Commission,” the advisor said, adding “We hope the best way would be to put it in structure even if it is to be privatised.”
However, Senator Kulsoom Parveen and Senator Sitara Ayaz opposed the idea of privatising the mills.
“Solid sludge of raw iron as high as 13 feet has accumulated in the furnace due to the abrupt shut down of the mills after its gas supply was stopped by the previous government. There has to be a new system to replace the whole blast furnace,” he said.
The adviser added, “Pakistan is broke. We cannot finance the revival therefore private investment was eminent.” He also said the government would be separating PSM land from the production unit to cut off the interest of land grabbers.
