FBR to allow duty free import of raw material, machinery, equipment

The federal government has revised its Export Facilitation Scheme, enabling goods exporters to import necessary raw material, machinery, and equipment without incurring duties and taxes, contingent upon specific conditions.

This regulatory change, aimed at stimulating the country's exports, mandates exporters to secure authorization from the Collectorate for their imports.

Under the newly introduced amendments, the permissible import value of machinery and equipment has been capped at 50% of the exporter's annual export valuation.

Moreover, for import contracts exceeding $1 million in raw material aimed at fulfilling export obligations, the chief collector's sanction is requisite.

The Federal Board of Revenue (FBR) is at the forefront of this initiative, having drafted revisions to the Customs rules to encapsulate the aforementioned provisions.

This draft is currently in a public consultation phase, inviting feedback from various stakeholders over a 15-day period before the finalization of these amendments through official notification.

Introduced originally in 2021, the Export Facilitation Scheme seeks to further entice participation by offering exemptions to new entrants in the export market.

Exporters who have not previously utilized export financing schemes or participated in export incentives are now eligible to benefit from duty-free importation of raw materials, machinery, and equipment.

This move is designed to lower the entry barriers for new exporters, facilitating their contribution to the nation's export growth.

The FBR's latest adjustments are anticipated to invigorate the export sector, encouraging broader participation and enhancing the country's export capabilities.