ISLAMABAD (December 31 2003): The government has, in principle, agreed to extend SRO 410(I)/2001 provisions along with certain amendments, taking away extraordinary incentives for the manufacturers-cum-exporters from January 1, 2004.
Sources dealing with SRO 410 told Business Recorder here on Tuesday that the Central Board of Revenue (CBR) has redrafted SRO 410(I)/2001 to plug the loopholes, making it less lucrative for the business community.
Under the new notification, the import consignments of duty-and tax-free raw materials/inputs would be released only against bank guarantee, to be submitted by the manufacturers-cum-exporters, from January 1, 2004.
Similarly, the refund would be paid on the basis of calculation made by the Input/Output Coefficient Organisation, Karachi.
The new format of SRO 410 has been dispatched to Ministry of Commerce for further consideration.
The CBR has strongly opposed further extension in the scheme to attract exporters under Duty and Tax remission for Export Rules (DTRE). However, CBR has categorically conveyed to Commerce Ministry that if it is necessary to further extend SRO 410, then unnecessary incentives should be taken away to make the scheme less attractive in future.
In this connection, the CBR has proposed that the Input Output Coefficient Organisation (IOCO), Karachi, should work out the actual consumption of raw materials imported under the 'Temporary Importation Scheme'.
The IOCO working would form the basis of payment of refund on the actual consumption of inputs.
The exporters of leading value-added industries have only one day to avail exemption of duties and taxes on temporary import of raw materials/inputs used in the manufacture of finished products. SRO 410 would expire on December 31, 2003.
As far as time period of extension of SRO 410 is concerned, sources said, it would depend on CBR's amendments, being proposed in the 'Temporary Importation Scheme', and extension time period would be allowed after finalisation of these amendments.