Coronavirus: ‘Blue-eyed’ companies earned billions after tax exemption on 61 imported goods

ISLAMABAD: A few ‘blue-eyed’ companies, mostly related to the medical equipment and machinery, have allegedly pocketed billions of rupees in the wake of tax exemption on the import of 61 items.

Some brands were specifically named in the first notification of the Federal Board of Revenue (FBR) issued last month to import goods before the issuance of second notification on April 16 that has allowed all companies from benefitting from tax exemption.

Sources said the FBR had issued a notification on March 20, 2020, giving exemption to 61 goods related to the medical equipment and machinery from sales tax for three months.

The goods include life technologies 7,500 real time PCR with RNase P instrument verification kit and complete guide documentation and softwares, Dr Oligo Synthesizer, Vortex Machine (0-3000 RPM 220v), Velp Italy, Refrigerated Centrifuge Machine Temperature Range, Hermle IEC 1010, Tyvek Suits, N-95 masks, Biohazard Bags (18 litres), Powered Air Purifying Respirators (PAPR), nitrile gloves, latex gloves, goggles and other lifesaving instruments.

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The bureau may extend period of three months in addition to ongoing three months on the recommendation of the Ministry National Health Services, Regulation and Coordination if adverse circumstances related to the COVID-19 pandemic prevail, the notification reads.

Meanwhile, the tax department, on April 16, 2020, issued an amendment notification, in which the department had removed brand names in its actual notification on SRO 237(1)/2020 issued on March, 20, 2020.

Sources said FBR, in its April 16 notification, had changed the goods of specific brands into generic machinery as well as medical equipment.

Companies had not only availed millions of rupee tax exemptions, but also imported a large quantity of goods mentioned in the notification in order to sell in the market in the months to come, sources added.

The FBR’s spokesman said that the Ministry of National Health Services had made a decision earlier to include names of brands and now they again had asked to remove these names that led to an amendment in the notification.

The possible reason for mentioning names of brands earlier might be some quality concerns as well as compatibility with the existing equipment, he added.

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