04-18-2011, 12:55 PM
LAHORE – The sale of zero-rated cement, that was supposed to be exported to Afghanistan, goes unabated in the local market, depriving the national exchequer of millions of rupees, as the FBR has no solid monitoring system to check the bogus sale, the Nation learnt.
According to sources, the cement dispatches, aimed at exporting to Afghanistan, are exempted from all taxes, amounting to over Rs90 per bag. So several cement manufacturers, getting benefit of the absence of the FBR monitoring system, and exploiting the loopholes in the system, sell their product in the local market and mint more profit.
The sources said that there is a strong need to monitor the exports to Afghanistan and Federal Board of Revenue should take concrete measures to curb this malpractice which is depriving the national exchequer of millions of rupees. “This practice is also harmful for the cement mills that sell their product in the local market after paying all government levies”, said sources. They said that mills, selling cement in local market after availing Rs 90 duty concession on export, marginalize the other producers who are already posting huge losses.
“This unethical practice has surfaced in recent years”, said an expert. He said that there should be a credible system that should monitor the physical delivery of cement to Afghanistan. He said that the Federal Board of Revenue is the competent authority to devise a transparent system in this regard.
The solution to eliminate evasion of duties lies in proper monitoring of production and dispatches by the Federal Board of Revenue which will also ensure fair play for all cement units and check tax evasion. The cement sector experts said that in the past this monitoring was done by the All Pakistan Cement Manufacturers Association which for some reason was stopped by Competition Commission of Pakistan.
According to sources, the cement dispatches, aimed at exporting to Afghanistan, are exempted from all taxes, amounting to over Rs90 per bag. So several cement manufacturers, getting benefit of the absence of the FBR monitoring system, and exploiting the loopholes in the system, sell their product in the local market and mint more profit.
The sources said that there is a strong need to monitor the exports to Afghanistan and Federal Board of Revenue should take concrete measures to curb this malpractice which is depriving the national exchequer of millions of rupees. “This practice is also harmful for the cement mills that sell their product in the local market after paying all government levies”, said sources. They said that mills, selling cement in local market after availing Rs 90 duty concession on export, marginalize the other producers who are already posting huge losses.
“This unethical practice has surfaced in recent years”, said an expert. He said that there should be a credible system that should monitor the physical delivery of cement to Afghanistan. He said that the Federal Board of Revenue is the competent authority to devise a transparent system in this regard.
The solution to eliminate evasion of duties lies in proper monitoring of production and dispatches by the Federal Board of Revenue which will also ensure fair play for all cement units and check tax evasion. The cement sector experts said that in the past this monitoring was done by the All Pakistan Cement Manufacturers Association which for some reason was stopped by Competition Commission of Pakistan.