ISLAMABAD (November 30 2002) : The anxiety of CNG industry is over as the custom authorities late on Friday night finally signed an SRO for the exemption of GST/duty on CNG kits and cylinders till June 30, 2004.
Five percent custom duty on the import of machinery and compressors has also been imposed with effect from November 1, 2002 to June 30 2004, while these items would remain exempt from payment of sales tax.
The Central Board of Revenue CBR on Saturday (November 30) would issue notification as the legal formalities of vetting from law and justice division and signing by the custom official have been completed on Friday.
According to the amended SRO. 38, exemption of sales tax and custom duty would continue on the import of CNG kits and cylinders till June 30 2004. But investors of CNG machinery and compressors are required to pay 5 percent import duty up to June 2004.
A senior custom official told Business Recorder that the CNG industry was desperately waiting for the issuance of exemption SRO for the CNG regime. This facility would definitely help in expansion of CNG industry, as more vehicles would switch on to CNG reducing the demand of petrol, which consumes a handsome chunk of foreign exchange.
Some of the investors had imported the CNG machinery and equipment during the last week of October/first week of November and were unaware that the SRO would expire on November 1, 2002.
The investors were not ready to clear their consignments from the ports on the expected extension in the time period of exemption. They were paying heavy demurrage on the machinery equipment, which were not being lifted due to issuance of exemption SRO.
The petroleum ministry has also examined the new notification in the light of ECC decision and hand it over to the CBR for issuance.
Economic Co-ordination Committee (ECC) of the Cabinet slashed the time period for exemption of custom duty and sales tax up to June, 2004, superseding its earlier decision, which extended exemption till October 2007.
It may be recalled that the CBR had strongly opposed the extension in the exemption of duties and taxes to the CNG industry.