Senate Committee Reviews Customs Duty Proposals in Finance Bill 2023

Senate Committee Reviews Customs Duty Proposals in Finance Bill 2023

Islamabad, June 14, 2023: The Senate Standing Committee on Finance and Revenue recently conducted a comprehensive review of the proposed customs duty amendments introduced through the Finance Bill 2023.

Under the leadership of Chairman Senator Saleem Mandviwala, the committee analyzed the proposed changes in the first schedule to the Customs Act, 1969 (Pakistan Customs Tariff). The meeting, held at the Parliament House on Wednesday, saw the participation of senior officials from the National Tariff Commission (NTC), Federal Board of Revenue (FBR), and Ministry of Commerce, who provided insights into the reasoning behind the proposed amendments.

READ MORE: Tax Experts Explain Reintroduction of Tax on Bonus Shares through Finance Bill, 2023

During the meeting, a detailed clause-by-clause review of the customs duty proposals and changes for various items and raw materials took place. Chairman Senator Saleem Mandviwala emphasized the importance of ensuring that any relief or concessions granted to businesses in terms of duties should be reflected in reduced prices for customers.

Furthermore, he emphasized the need for a comprehensive overview of any sales tax and income tax concessions provided to these businesses. Senator Mandviwala also highlighted that regulatory duties should not be utilized solely as a revenue-generating measure but should instead serve to promote fair trade practices and protect domestic industries.

READ MORE: Higher Rate of Super Tax Extended to All Taxpayers

Representatives from the Packaged Juices industry voiced their concerns and requested the abolition of the 10% excise duty. They highlighted that the increased excise duty imposed last year has not yielded any revenue gain for the government and has instead led to a significant decrease in sales.

Additionally, representatives from the Pakistan Association of Large Steel Producers presented the challenges faced by the steel industry in Pakistan. They suggested that the supply of local steel scrap should be exempted from sales tax under Section 13 of the Sales Tax Act 1990. They also proposed reducing the income tax withholding rate on scrap supplies to 0.25% under Section 153 of the Income Tax Ordinance.

READ MORE: Finance Bill 2023 Introduces New Tax Slabs for Super Tax

Representatives from the All Pakistan Textile Mills Association (APTMA) briefed the committee on the issues faced by the textile industry. They expressed concern over the lack of subsidies in electricity and gas for the industry in the current budget, which could create difficulties. They urged the government to amend the budgetary proposals and provide essential relief to the textile industry, as it employs around 20 million people. They further stated that due to the increased cost of production, 50% of textile units in Punjab have already shut down, and without subsidies, an additional 25% may face closure.

The meeting was attended by Senator Saadia Abbasi, Senator Faisal Saleem Rehman, Senator Kamil Ali Agha, Senator Imamuddin Shouqeen, as well as officials from the NTC, FBR, Ministry of Finance, and Ministry of Commerce. Representatives from various industries, including textiles, steel, juices, and food, were also present.

READ MORE: Pakistan Imposes 10% Income Tax on Bonus Shares Issued by Companies

The Senate Committee’s review of the customs duty proposals highlights the government’s commitment to ensuring fair trade practices, protecting domestic industries, and addressing concerns raised by various sectors.