Latest news with #AdditionalCustomsDuty
Business Recorder
2 days ago
- Business
- Business Recorder
Enhanced revenue collection, economic growth: FBR introduces substantial amendments to Customs Act, 1969
LAHORE: The Federal Board of Revenue (FBR) has introduced substantial amendments to the Customs Act, 1969, as part of the Finance Act 2025. These changes aim to enhance revenue collection, streamline import and export processes, and promote economic growth. The 2025 amendments to duty rates bring significant changes across multiple sectors — from textiles and electronics to building materials, automobiles, and beyond. Key changes included Cargo Tracking System (CTS), tariff rationalisation, reduction in Additional Customs Duty (ACD) rates, Regulatory Duty (RD) Regime, exemption regime, and sector-specific changes. So far as CTS is concerned, a new section 83C has been added to the Customs Act, 1969, introducing CTS to monitor imports, exports, and transit goods. The system will be implemented once the necessary technological infrastructure is developed. On the tariff rationalisation front, new tariff slabs of 5%, 10%, and 15% have been introduced, while existing slabs of 3%, 11%, and 16% have been abolished. The 0% tariff slab has been extended to further 916 PCT codes. Similarly, Additional Customs Duty (ACD) rates have been reduced on various tariff slabs, including 0%, 5%, and 10%, with some exceptions. In addition, Regulatory Duty (RD) rates have been revised downward on 1011 PCT codes, with a maximum rate reduction from 90% to 50%. On the front of exemption regime, 479 entries in Part-1, Part-III, and Part-VII of the Fifth Schedule to the Customs Act, 1969, have been deleted to streamline and reduce the cost of exemptions. Regarding sector-specific changes, knitted fabrics will now attract a duty rate of 20% or Rs 115/kg, whichever is higher in textiles. Interactive Flat Panel Displays will attract a duty rate of 20% in electronics. Duty rates on motor vehicles for transport of goods and passengers have been revised in automobiles and duty rates on solar cells and modules have been reduced in solar energy sector. So fast as implementation is concerned, the changes are effective from various dates, including February 2, 2025, and May 1, 2025. The FBR has directed concerned officers and officials to carefully review the budget documents to avoid misinterpretation or misapplication of the budgetary measures. Copyright Business Recorder, 2025
Business Recorder
02-07-2025
- Business
- Business Recorder
FBR abolishes ACD on imports under 0pc, 5pc and 10pc duty slabs
ISLAMABAD: The Federal Board of Revenue (FBR) has totally abolished Additional Customs Duty (ACD) on the import of goods falling under the customs duty slabs of zero percent, 5 percent and 10 percent from July 1, 2025. From July 1, 2025, the FBR has also reduced Regulatory Duty (RD) on the import of 1,022 items. In this regard, the FBR has issued two notifications here on Tuesday to implement customs tariff reductions. According to the officials, the overall goals of the National Tariff Policy 2025-2030, formulated by the Ministry of Commerce, are elimination of ACD in 04 years, elimination of RD in 05 years, complete phasing out of Customs duties exemptions under 5th schedule in 05 years, reduction of Customs Duty slabs from existing 5 slabs to 4 Slabs of 0%, 5%, 10% and 15%. National Tariff Policy: govt approves phased elimination of import duties The Budgetary changes in Additional Customs Duty (ACD) and Regulatory Duty (RD) introduced in the Federal Budget 2025-26 are closely aligned with the National Tariff Policy. These reforms aim at achieving simplified duty structure, reduction in costs of production for industry, and promote trade facilitation. By lowering ACD and RD rates on a broad range of goods – particularly raw materials and intermediate inputs – the policy seeks to ensure a more predictable and transparent tariff regime that supports industrial growth and encourages export-led growth. Recalibration of Additional Customs Duty (ACD) has been introduced through SRO 1151(I)/2025, replacing the earlier SRO 929(I)/2024. ACD has been removed entirely for goods falling under the 0%, 5%, and 10% CD slabs – except for some tariff lines which will continue to be charged ACD at 2%. For goods under the 15% slab, ACD has been reduced from 4% to 2%. For goods under the 20% slab see a reduction from 6% to 4%, 2% or 0%. For slabs above 20%, the ACD is lowered from 7% to 6%. These changes aim to bring parity in effective protection levels and lower the cost of doing business, especially for intermediate and capital goods essential to export-oriented and import-substitution industries. Under Regulatory Duty (RD) reforms notified vide SRO 1152(I)/2025 RD has been reduced on 1,022 PCT codes. This includes substantial reduction of 50% and 20% on around 1000 PCT codes. The maximum RD rate has been cut significantly from 90% to 50%, aligning with international trade norms and reducing excessive protection. The regulatory duties have not been completely removed for locally produced goods to provide protection to local industries. On more than 900 PCT codes of mainly consumer goods, RD has been retained at prior rates, officials added. Copyright Business Recorder, 2025
Business Recorder
02-07-2025
- Business
- Business Recorder
FBR abolishes ACD on imports under 0pc, 5pc and 20pc duty slabs
ISLAMABAD: The Federal Board of Revenue (FBR) has totally abolished Additional Customs Duty (ACD) on the import of goods falling under the customs duty slabs of zero percent, 5 percent and 10 percent from July 1, 2025. From July 1, 2025, the FBR has also reduced Regulatory Duty (RD) on the import of 1,022 items. In this regard, the FBR has issued two notifications here on Tuesday to implement customs tariff reductions. According to the officials, the overall goals of the National Tariff Policy 2025-2030, formulated by the Ministry of Commerce, are elimination of ACD in 04 years, elimination of RD in 05 years, complete phasing out of Customs duties exemptions under 5th schedule in 05 years, reduction of Customs Duty slabs from existing 5 slabs to 4 Slabs of 0%, 5%, 10% and 15%. National Tariff Policy: govt approves phased elimination of import duties The Budgetary changes in Additional Customs Duty (ACD) and Regulatory Duty (RD) introduced in the Federal Budget 2025-26 are closely aligned with the National Tariff Policy. These reforms aim at achieving simplified duty structure, reduction in costs of production for industry, and promote trade facilitation. By lowering ACD and RD rates on a broad range of goods – particularly raw materials and intermediate inputs – the policy seeks to ensure a more predictable and transparent tariff regime that supports industrial growth and encourages export-led growth. Recalibration of Additional Customs Duty (ACD) has been introduced through SRO 1151(I)/2025, replacing the earlier SRO 929(I)/2024. ACD has been removed entirely for goods falling under the 0%, 5%, and 10% CD slabs – except for some tariff lines which will continue to be charged ACD at 2%. For goods under the 15% slab, ACD has been reduced from 4% to 2%. For goods under the 20% slab see a reduction from 6% to 4%, 2% or 0%. For slabs above 20%, the ACD is lowered from 7% to 6%. These changes aim to bring parity in effective protection levels and lower the cost of doing business, especially for intermediate and capital goods essential to export-oriented and import-substitution industries. Under Regulatory Duty (RD) reforms notified vide SRO 1152(I)/2025 RD has been reduced on 1,022 PCT codes. This includes substantial reduction of 50% and 20% on around 1000 PCT codes. The maximum RD rate has been cut significantly from 90% to 50%, aligning with international trade norms and reducing excessive protection. The regulatory duties have not been completely removed for locally produced goods to provide protection to local industries. On more than 900 PCT codes of mainly consumer goods, RD has been retained at prior rates, officials added. Copyright Business Recorder, 2025
Business Recorder
14-06-2025
- Business
- Business Recorder
Food sector: PVMA Chairman terms Federal Budget disappointing
KARACHI: Sheikh Umer Rehan, Chairman of the Pakistan Vanaspati Manufacturers Association (PVMA), has termed the Federal Budget 2025-26 disappointing for the food sector, particularly the ghee and cooking oil industry. Expressing serious concerns, he stated that instead of providing relief, the budget proposes measures that will increase production costs, inevitably leading to higher food inflation. While appreciating the governments move to abolish the 'non-filer' category and broaden the tax net, a long-standing demand of the business community. Sheikh Umer Rehan lamented that the core issues of the edible oil industry have been completely ignored in the budget. He highlighted that sales tax refunds have been pending for extended periods, causing severe liquidity challenges for the sector. Additionally, Section 8B of the Sales Tax Act imposes an undue financial burden by requiring manufacturers to pay extra taxes. 'If the government cannot ensure timely payment of refunds, it should at least abolish Section 8B immediately,' he asserted. Sheikh Umer also welcomed the removal of Additional Customs Duty (ACD) on imports in the budget but stressed that this benefit must be extended to the ghee and cooking oil sector. This, he argued, would not only provide relief to the struggling industry but also help reduce prices for consumers. He warned that the edible oil industry is already under immense pressure due to high import taxes, duties on raw materials, and the devaluation of the Pakistani Rupee. Now, with additional levies like the petroleum levy and carbon tax, production costs are set to increase dramatically, making it even harder for the industry to sustain operations. Sheikh Umer said that government has once again overlooked practical measures to boost domestic production of edible oils and to reduce reliance on expensive imports. He pointed out structural flaw in the government's economic planning, stating that the burden of taxation continues to fall disproportionately on the existing formal sector, particularly manufacturers, while the agriculture sector, contributing 25% to the national GDP, remains largely outside the tax net, contributing less than 1% to tax revenues. Sheikh Umer expressed disappointment that while the tax exemptions for the former FATA/PATA regions have been slightly reduced; they have not been entirely eliminated, leaving local manufacturers at a continued disadvantage. He urged the government to reduce indirect taxes and levies on essential food items, provide relief on raw material imports, and bring the agriculture sector into the tax net to ensure a more equitable tax regime. He warned that 'Without concrete measures to support the edible oil industry, controlling food inflation will remain an unattainable goal.' Copyright Business Recorder, 2025
Business Recorder
02-06-2025
- Business
- Business Recorder
Sindh farmers ask FBR to reduce duty on tractors
ISLAMABAD: Small farmers from Sindh have approached Federal Board of Revenue (FBR) to reduce custom duty on imported tractors from 15 percent to 5 percent under massive tariff rationalisation plan to be implemented in budget (2025-26) to support agriculture sector. Farmers have also proposed FBR Chairman Rashid Mahmood to reduce the existing sales tax rate on locally manufactured and imported tractors from 14 percent to 5 percent, enabling the farmers to purchase tractors. This is not an exemption, but only a reduced rate already applicable of many items including vehicles under Sales Tax Act. The budget proposals of the Sindh Chamber of Agriculture (SCA) Hyderabad to FBR Chairman included rationalisation of tax structure and abolishment of levy of sales tax on tractors to support agriculture sector. Sales tax on tractors, pesticides likely When contacted, sources in the FBR revealed that the proposals are under consideration of the FBR during ongoing budget preparation exercise to facilitate poor farmers of the country. The chamber stated that the approved tariff plan to be implemented in budget (2025-26) covers elimination of Additional Customs Duty (ACD); phasing out of Regulatory Duty (RD); gradual elimination of the Fifth Schedule of the Customs Act and restructuring of the customs tariff. This must cover most essential item i.e. tractor which is not a luxury item like vehicle. Nabi Bux Sathio, Senior Vice President, Sindh Chamber of Agriculture Hyderabad stated: 'We, as representatives of the farming and agricultural community in Sindh, feel compelled to shed light on the significant challenges and hardships faced by our fellow farmers and agriculturists in recent times'. The chamber stated that the agricultural sector plays a pivotal role in Pakistan's economy, contributing 24% to the GDP and employing 37.4% of the workforce. However, the sector is currently grappling with a myriad of complex issues. These include the lack of investment and support, the adverse effects of climate change, and the dwindling availability of water, exacerbating the challenges faced by farmers and agriculturists. Moreover, farmers have been severely impacted by the inability to secure fair prices for their produce. The government's announcement of support prices for wheat and cotton has not translated into actual purchases at the stipulated rates, leaving farmers with no choice but to sell their crops at significantly lower prices. The situation is further compounded by the low prices offered for rice and the potential delay in the sugar cane crushing season, which has added to the woes of the farming community. He urged the FBR to reduce the existing sales tax rate on locally manufactured and imported tractors from 14% to 5% enabling the farmers to purchase tractors, and also reduce the custom duty on imported tractors from 15% to 5% and also for re-conditional tractors. Copyright Business Recorder, 2025
