ISLAMABAD: In an attempt to promote country’s exports and to facilitate export-oriented industries, the federal government has decided to introduce new tariff lines in the federal budget for 2019-20.
Under the five-year National Tariff Policy, the percentage of duty on import of raw material will be reduced. The new three-year trade policy will be unveiled after the budget for next fiscal year.
Consensus has been reached for phase-wise implementation of all the tariff lines prepared under the five-year tariff policy. Important tariff lines will be included in the budget for next fiscal year.
The decision was made in a recent meeting held at the Commerce Division, which was attended by the adviser to PM on commerce, National Tariff Commission officials and Federal Board of Revenue (FBR) Chairman Shabbar Zaidi.
When contacted, Commerce Division spokesperson Muhammad Ashraf shared that tariff recommendations presented in the newly proposed tariff policy were discussed in the meeting and it was decided to implement them in a phase-wise manner.
Ashraf said in order to reduce the cost of production of exported goods and to promote manufacturing, the suggestion on tariffs on the import of raw material in the proposed tariff policy would be included in next budget.
Replying to a question, the spokesperson said steps had been taken to restrict the trade deficit by increasing duty rates in the supplementary finance bill. He was of the view that the measures had yielded positive results by lowering the country’s imports.
“In the next budget, focus is on increase in exports and manufacturing activity, and steps for export-oriented growth will be taken,” he stressed. “If necessary, more steps to control imports will be taken but these will be less severe this time.” Replying to another question, he pointed out that the proposed five-year tariff policy had not yet been approved by the federal cabinet but its important recommendations were being included in the budget.
Sources said tariff rationalisation in the federal budget was discussed in the meeting and the FBR’s Customs Department would give input on budget recommendations of the National Tariff Commission. These recommendations, after finalisation, would be made part of the budget. It has been decided that the exorbitant discount in duty and taxes would be abolished and special procedures would be removed.
Sources said the recommendations put forth by importers for removing the disparity in duties and taxes on imported items used in export products was also under consideration.
Published in The Express Tribune, May 26th, 2019.