KARACHI: Sales tax collection from imports rose 18.5 percent to Rs200.72 billion in the first quarter of the current fiscal year of 2019/20 as the government raised duties and withdrew certain exemptions to mobilise revenue, reported The News.
According to the report, the collection rose due to abolishing of incentives in sales tax regime and imposition of higher customs duty rates.
Sales tax collection from imports amounted to RsRs169.4 billion in the corresponding period of the last fiscal year, said the sources in large taxpayers unit, which has jurisdiction over collection of sales tax and federal excise duty on import stage.
According to the report, customs duty on imported goods is collected at the first stage and an importer pays sales tax on the enhanced value, inclusive of customs duty.
“Sales tax collection also grew due to an increase in the rate of additional customs duty for non-essential items,” said an official quoted in the report. Increase in sales tax collection is encouraging in the wake of declining trade volume during the period.
Federal Board of Revenue Chairman Shabbar Zaidi said the import volume has contracted to the tune of $3 billion during the first quarter. The contraction in import value impacted the revenue of around Rs125 billion, he said.
The collectorate collected Rs95.5 billion as sales tax during July-September 2019 when compared with Rs74.2 billion in the corresponding period of the last fiscal year. Customs Collectorate Appraisement (East) Karachi collected Rs54.3 billion as sales tax, showing growth of nine percent when compared with Rs50.3 billion in the same period of the last fiscal year.
The Large Taxpayers Unit Karachi has jurisdiction over collection of federal excise duty on imports. The collection of federal excise duty posted a 23 percent growth to Rs2.54 billion during July-September 2019 when compared with Rs2.07 billion in the corresponding period of the last fiscal year.
