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Manufacturers get relief under 'Duty and Tax Remission for Export' scheme

ISLAMABAD (February 20 2003) : Relaxing a major condition of 'Duty and Tax Remission for Export' (DTRE) scheme to register more exporters, the Central Board of Revenue (CBR) has decided not to immediately demand duties and taxes on inputs/raw materials not utilised in production of exportable goods within stipulated period of 12 months.

The manufacturers/exporters working under DTRE have been allowed to use the over-stayed inputs/raw materials procured under DTRE on payment of penal surcharge at the rate of 1 percent or 2 percent per month of the FOB value of unfulfilled exports, as the case may be.

The duties and taxes would not be demanded on immediate expiry of the initial period of 12 months.

The CBR on Wednesday directed all collectors of customs to forthwith implement the decision which, according to concerned officials, would be instrumental in bringing maximum investors under the DTRE scheme.

A number of DTRE approved manufacturers/exporters had approached CBR with the complaint that the Collectorates were demanding payment of duty and taxes on over-stayed goods procured under DTRE, immediately on expiry of initial 12 months.

Promptly responding to the compliant, the CBR referred to the provisions of Rule-298 of DTRE which reads: “Utilisation period of input goods.

The input goods shall be utilised in production and export within twelve months of the date of approval under rule 297, which period shall be automatically extended, upon request, once only, up to a further period of six months on payment of one percent per month of the FOB value of unfulfilled exports.

Inputs whether imported or locally purchased not consumed within eighteen months shall be subjected to payment @ 2 percent per month of the value of unfulfilled exports”.

The CBR has issued instructions to all collectorates that the manufacturers/exporters working under DTRE may be allowed to use the over-stayed inputs/raw-materials procured under DTRE on payment of penal surcharge at the @ 1 percent or 2 percent per month of the FOB value of unfulfilled exports, as the case may be, and that duty and tax may not be demanded on immediate expiry of the initial period of 12 months.

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