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Elimination of GST at import stage urged

Business

May 16, 2019

KARACHI: Tractor manufacturers have urged the Federal Board of Revenue (FBR) to eliminate general sales tax (GST) at import stage.

“This will in turn give a sigh of relief to the local tractor industry,” said Mohammad Shahid Hussain, chief executive officer of Al-Ghazi Tractors Ltd, in a statement.

“The industry has been proposing for years to abolish GST at import stage on CKD components imported by the tractor OEMs for local assembly of tractors, as there is no point in paying sales tax directly to the government in a given month and subsequently claim refund in the following month,” Shahid said.

Currently, output sales tax is chargeable on supply of tractors at the rate of five percent as against 17 percent payable as input tax while purchasing components, local, as well as imported.

Shahid said sales tax refunds are not being released in a timely manner, ie, three days from the claim sanctioned, instead of due refunds are released in tranches with delay of various months.

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