Pak’s GST relief for machinery import

Pakistan’s Federal Board of Revenue (FBR) has exempted sales tax on the import of machinery (not manufactured locally) by textile units registered with the Ministry of Textile Industry from January 16, 2017 till June 30, 2018. In this connection, the FBR has amended SRO 1125(1)2011 through an SRO 36(1)/2017 issued recently.

According to the SRO, zero per cent sales tax would be applicable on machinery, not manufactured locally, if imported by textile industrial units registered with Ministry of Textile Industry, as specified in Part IV of the Fifth Schedule to the Customs Act, 1969, subject to same conditions as specified therein. Following is the text of the SRO 36(1)/2017 issued here on Monday: In exercise of the powers conferred by sub-section (1), clause (b) of sub-section (2) and sub-section (6) of section 3 and clauses (c) and (d) of section 4 read with clause (b) of sub-section (1) of section 8 and section 71 of the Sales Tax Act, 1990, the federal government is pleased to direct that the following further amendments shall be made in its Notification No SRO 1125(1)2011, dated 31st December 2011, namely: In the aforesaid Notification, (a) in Table II, in column (1), after S. No.4 and entries relating thereto in columns (2), (3) and (4), the following new S. No.5 and corresponding entries relating thereto shall be inserted, namely: "5. Machinery, not manufactured locally, if imported by textile industrial units registered with Ministry of Textile Industry, as specified in Part IV of the Fifth Schedule to the Customs Act, 1969, subject to same conditions as specified therein. Respective headings 0%; and (b) after Table II, amended as aforesaid, in the conditions, in clause (ii), for sub-clause (a), the following shall be substituted, namely: "(a) in case of textile sector, for imports, raw cotton stage and onwards, and for local supplies spinning stage onwards;" 2. This notification shall be effective from the 16th day of January 2017 till the 30th day of June 2018 (both days inclusive), unless rescinded earlier.