ISLAMABAD: The government has revoked the Cabinet Division’s powers to grant an exemption over gifts or donations from import duties.
According to well-informed sources, the federal Cabinet has directed the Federal Board of Revenue (FBR) to amend the Pakistan Customs Tariff so as to replace the words ‘Cabinet Division’ with the ‘Federal Government’ as an authority to exempt gifts or donations from import duties and taxes.
Similarly, the Cabinet approved the exemption of duties and taxes on fuel imported by the Pakistan Navy (PN) from the Royal Saudi Naval Forces (RSNF). Sources said that FBR’s Customs Wing, Inland Revenue Policy Wing and Revenue Division had thrown their support behind the exemption on a gratis basis.
Earlier, the defence division in a summary had sought the approval of the federal cabinet in terms of Rule 16 (1) (d) and 18 (1) of Rules of Business, 1973 and cabinet approved the proposal.
“During the meeting, the special assistant to the prime minister on revenue had clarified that the exemption may be confined to duties and taxes at import stage only and the surplus quantity of fuel sold in the open market should be subjected to normal taxes,” sources said.
According to documents, the Pakistan Navy provides professional, operational training to RSNF officers and sailors in Pakistan, conducting on-job-training (OJT) and bilateral exercises on an annual basis.
In reciprocity, RSNF provides gratis fuel to PN which is used for operational purpose and surplus quantity if any is sold through the normal tendering procedure. Sale proceeds are utilised for maintenance and up-gradation of PN training facilities for RSNF and other friendly countries navies.
In 2018, on receipt of 10,000M/tonne fuel from RSNF, Customs authorities asked for a certificate for payment of Customs duties/taxes on account of import of fuel.
