FBR exempts withholding tax on wheat import

FBR exempts withholding tax on wheat import

In a move to facilitate the import of essential commodities, the Federal Board of Revenue (FBR) issued a notification on Tuesday, exempting withholding income tax on the import of 300,000 metric tons of wheat.

The FBR’s decision, outlined in SRO 99(I)/2021, aligns with the government’s initiative to allow the import of wheat without the burden of withholding income tax.

The FBR clarified that the exemption is in accordance with the provisions of section 148 of the Income Tax Ordinance, 2001. This step is a response to the Cabinet Decision made in case No. 34/02/2021 on January 12, 2021, aiming to support the import of three hundred thousand metric tons of wheat through a tendering process facilitated by the Trading Corporation of Pakistan (TCP).

This move by the FBR is seen as a strategic measure to ensure an uninterrupted supply of wheat, a staple food item in Pakistan. The exemption from withholding income tax on this specific import demonstrates the government’s commitment to addressing food security concerns and stabilizing wheat prices in the domestic market.

The notification signals a proactive approach by the FBR to collaborate with the government’s policy decisions and provide necessary relief in the taxation framework for crucial imports. Wheat, being a fundamental component of the Pakistani diet, is closely monitored, and initiatives like these are aimed at maintaining a steady supply chain to meet the country’s consumption needs.

The specified exemption applies exclusively to the import of 300,000 metric tons of wheat through the TCP’s tendering process. This indicates a targeted effort to address a specific quantity crucial for maintaining the country’s wheat reserves and ensuring food security.

The FBR’s commitment to aligning its policies with government directives is expected to encourage smooth trade operations and bolster the economy by ensuring the availability of essential commodities. The decision also reflects a recognition of the interconnectedness of taxation policies and the broader economic goals set by the government.

As the government continues to navigate economic challenges, measures like these showcase a responsive and adaptable approach to policy-making. The FBR’s notification provides clarity and assurance to traders and stakeholders involved in the wheat import process, fostering an environment conducive to trade and economic growth.

Overall, the exemption of withholding income tax on the import of 300,000 metric tons of wheat underscores the government’s dedication to ensuring food security, addressing market dynamics, and supporting crucial sectors of the economy. This move is likely to have a positive impact on the country’s overall economic stability and resilience.