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Four categories of shipping agents to pay fixed CED

ISLAMABAD (July 23 2004): The Central Board of Revenue (CBR) has announced that four categories of shipping agents, including non-vessel operating common carriers (NVOCC), international freight forwarders, slot carriers and consolidators would pay a fixed amount of central excise duty (CED) on their services.

These unorganised shipping agents are operating on limited scale, but they are not paying 15 percent CED as service charges.

The CBR has amended Central Excise Rules 1944 through an SRO 621 (I)/2004 issued here on Thursday to notify fixed CED rate for these service providers.

According to the notification, “NVOCC, international freight forwarders, slot carriers and consolidators shall charge, collect and pay Rs 200 as excise duty on every “house bill of landing” issued by them instead of the rate specified for the shipping agents.”

Sources told Business Recorder that the organised shipping agents, shall charge, collect and pay the central excise duty at the rate of 15 percent of value of excisable services, which would be the commission charged by an agent on the net ocean freight amount of C & F export cargo for such services provided or rendered by him.

However, NVOCC, international freight forwarders, slot carriers and consolidators are not operating in organised sector, as they do not have their own shipping carriers and shipping vessels. Moreover, they used to forward small and medium consignments to the shipping lines. Thus, it would be difficult for them to pay CED on the service charges.

The CBR and shipping agents in a recent meeting agreed that all these four categories of shipping agents should pay fixed amount of excise duty.

Following is the text of the notification issued on Thursday: “In exercise of the powers conferred by Section 37 read with sub-section (8) of Section 3 of the Central Excise Act, 1944, the Federal Government is pleased to direct that the following further amendment shall be made in the Central Excise Rules, 1944, namely:-

“In the aforesaid Rules, in Rule 96ZZK, in sub-rule (1), the full stop at the end shall be substituted by a colon and thereafter the following new proviso shall be added, namely:-

“Provided non-vessel operating common carriers (NVOCC), international freight forwarders, slot carriers and consolidators shall charge, collect and pay Rs 200 as excise duty on every “house bill of landing” issued by them instead of the rate prescribed in sub-rule (1) above.”

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