Pakistan Govt Notifies 50% Duty Drawback On Exports
The Pakistan government has notified the ‘Duty Drawback of Taxes Order 2017-18’, effective immediately. The announcement is in pursuance of the Prime Minister’s Package of Incentives for Exporters approved by Economic Coordination Committee (ECC) of the Cabinet to provide duty drawback of taxes collected from manufacturing cum exporter units.
As per the notification issued by the Textile Division, ministry of textile and commerce, the Order extends to the whole of Pakistan including Export Processing Zones. The duty drawbacks under the Order shall be allowed for exports GDs filed on or after July 1, 2017 to June 30, 2018.
While “50 per cent of the rate of drawback shall be provided without condition of increment, the remaining 50 per cent of the rate of drawback shall be provided, if the exporter achieves an increase of 10 per cent or more in exports during performance year (FY 2017-18), as compared to the base year (FY 2016-17),” the notification said.
“The actual rate of drawback against the remainder 50 per cent shall be determined on the basis of annual performance of the exporter, but in order to improve her/his cash flow, the disbursement shall be allowed on the performance during July-December 2017, subject to submission of a bank guarantee that the exporter will return the excess amount, in case his/her annual exports are less than the amount of drawback paid to him/her,” it added.
Further, an additional 2 per cent drawback shall be allowed for exports to non-traditional markets i.e. Africa, Latin America, non-EU European countries, Commonwealth of Independent States and Oceania.
The manufacturing cum exporting units availing the drawback have to be registered with the Textile Division and use Textile Division’s online portal to follow subsequent Circular issued by State Bank of Pakistan.