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Automated duty drawback processes 8,000 refunds

By Mehtab Haider
October 23, 2020

ISLAMABAD: The automated duty drawback system has processed nearly 8,000 claims involving Rs953 million in less than one month, officials said on Thursday.

The automated duty drawback system, conceived by Ministry of commerce and jointly implemented by Pakistan Customs, and State Bank of Pakistan, processed the refunds up to October 20, the officials told the ministry of commerce’s meeting, presided over by Adviser to the Prime Minister on Commerce Razak Dawood.

“This will be a major facilitation to our exporters because it will enable them to make adjustments in their pricing policy to have an edge over the competitors,” said Dawood. “Similar automated system shall be put in place for other refunds as well, including sales tax and income tax, to further facilitate the export sector.”

The automated system has been operational on 30 September. The system aims to provide a hassle-free facilitative environment, without human interaction, for the export sector by direct transfer of duty drawback (DDB) to accounts of exporters. This step, along with the ongoing exercise of revision of rates of duty drawback for various sectors, has been taken to address the longstanding issues of exporters’ regarding the refund claims.

The meeting was told that the process for corrective measures was initiated last year. The Input-Output Conformance did some quality work regarding the recalculation of DDB, which has resulted in revision of rates for a number of sectors, while the exercise is ongoing. The other major issue was the delays in payments, which has now been resolved with this automated system.

The Federal Board of Revenue settled Rs250 billion of sales tax refunds during the past six months owing to its automated system that will soon be emulated for adjusting income taxes.

A system for the faster clearance income tax refunds similar to the fully-automated sales tax e-refund (Faster) plus is also under development. The Faster plus has fully addressed all kinds of interruptions and issues which were suffered by the taxpayers in the previous system. The system has eight checks before processing the refund claims.