PESHAWAR: The Federal Board of Revenue earlier made an amendment in the Finance Act which made it mandatory to recover taxes from the importers of the FATA and PATA.
The importers of the Federally Administrative Tribal Areas and Provincial Administrative Tribal Areas challenged it in the Peshawar High Court.
A Division Bench, comprising of Justice Ikram Ullah and Justice Ghazanfar, on Tuesday issued a stay order against the recovery of Sales Tax from the Ghee and Steel Mills situated at the FATA and PATA at the import stage on account of Section 3 (1) amended vide Finance Act 2017.
Previously by virtue of the amendment, the FBR started claiming the Sales Tax on all the imports notwithstanding their destination anywhere in Pakistan.
The bench was told that since the Sales Tax Act 1990 was not extended to the FATA and PATA therefore its amendments are also not applicable to the importers hailing from the FATA and PATA.
The importers said our region was exempted from tax and now the FBR want us to pay tax for the exports we made or imports we send to the other regions.
It is pertinent to mention here that the Government of Pakistan has given exemption of duties to manufacture goods at factories situated in the FATA who, on conciliation with political administration, pay the manufacturers the required amount.
Now with the amendment in the Finance Act, the FBR made it mandatory to pay duty on export of manufactured goods here in the Pakistan and also duty was made compulsory for import of manufactured goods and raw materials to Pakistan.
The courts in this regard made the sales tax recovery invalid due to the nature of the Finance Act-1990.