The Federal Board of Revenue (FBR) announced on Wednesday that it has increased the minimum prices of steel products in an effort to align them with the rising costs observed in both domestic and international steel markets.
The adjustment comes in response to the evolving economic landscape and aims to safeguard revenue collection.
This decision, communicated through a statement, signifies the FBR’s commitment to adapting to market dynamics and ensuring that the taxation structure keeps pace with the changing economic conditions. The new minimum prices were notified through SRO 985 dated August 4, 2021, marking the first adjustment since the prices were last fixed in September 2019 under SRO 992.
The FBR, exercising its authority under the proviso to clause (46) of section 2 of the Sales Tax Act, 1990, has the power to set minimum prices for steel products. This provision empowers the revenue body to make periodic adjustments to the minimum prices to reflect the current economic realities and prevent revenue loss.
According to the latest notification, the revised minimum prices for various steel products per metric ton are as follows:
1. Bars: Rs. 140,000/-
2. Billets: Rs. 125,000/-
3. Ingots/Bala & Ship-plates: Rs. 120,000/-
4. Scrap: Rs. 118,000/-
The FBR has underlined that this upward revision is essential due to the recent surge in local and international steel prices. The move is not only aimed at maintaining the integrity of revenue streams but also at preventing any potential revenue loss resulting from the disparities between minimum prices and market values.
Furthermore, the FBR clarified that this adjustment is not a one-time measure; instead, it has indicated a shift toward a more dynamic approach. Going forward, the minimum prices of steel products will be subject to quarterly reviews and adjustments to ensure they remain in line with the prevailing market conditions.
The decision to raise the minimum prices of steel products is part of the FBR’s broader strategy to keep the tax structure reflective of the economic landscape. By regularly reassessing and updating minimum prices, the revenue body aims to strike a balance between facilitating businesses and ensuring the continued collection of revenue vital for the country’s economic growth.
As the steel industry navigates fluctuations in prices and market dynamics, this proactive measure by the FBR is expected to contribute to a more resilient and responsive taxation system. The FBR’s commitment to adapting swiftly to economic changes demonstrates its dedication to creating an environment that supports sustainable economic growth and stability.
