Federal Excise Duty
OVERVIEW OF FEDERAL EXCISE DUTY
The Federal
Excise Act, 2005, was promulgated with effect from 1st July,
2005, repealing the Central Excises Act, 1944. Following are some of
the significant changes brought about by the new Act:
-
The word
“Federal” was used in place of “Central”. Therefore, now the
term “Federal Excise Duty” is more appropriate as
compared to old “Central Excise Duty” for the duties of
excise levied under the 2005 Act.
-
The system of
physical supervision has been entirely done away with and now
all clearances will be self-assessed and no prior permission for
clearance will be required.
-
The payment of
duty will be on monthly basis and the duty on all clearances
during the month will be payable by the 15th of next month. This
is in contrast to previous requirement of payment of duty prior
to clearance.
-
No gate passes
are required for clearances as in the old system.
-
Double taxation
has been eliminated by allowing adjustment of the excise duty
paid on the input goods used directly in the manufacture of
excisable goods.
-
On some
services and goods FED is payable in VAT more i.e. in the same
manner as provided in the Sales Tax Act, 1990. For details see
the link ‘Goods/Services Liable to Excise Duty’ on this page.
Federal Excise duty is payable
on:
(a) goods produced or manufactured in
Pakistan;
(b) goods imported into Pakistan;
(c) such goods as the Federal Government may, by notification in the
official Gazette, specify, as are produced or manufactured in the
non-tariff areas and are brought to the tariff areas for sale or
consumption therein; and
(d) services,
provided or rendered in Pakistan;
However, all the goods and services are exempt
under section 16, except:
(a) the goods and services specified
in the First Schedule, which shall be charged to Federal excise duty
as, and at the rates, set-forth therein;
(b) The goods and services specified in Third Schedule shall be
exempt from duty subject to such conditions and restrictions, if
any, specified therein and no adjustment in terms of section 6 shall
be admissible in respect of goods exempt from duty of excise whether
conditionally or otherwise; and
(c) The goods as mentioned in the Second Schedule shall be
chargeable to FED in the same manner as provided in the Sales Tax
Act, 1990, as provided in section 7 of the Federal Excise Act, 2005.
The same shall apply to services as notified vide SRO 550(I)/2006
dated 5th June 2006.
Special Excise Duty
As part of budgetary measures for the
year 2007-08, Special FED at 1% has been levied on goods which are
manufactured or are imported in Pakistan. This duty is in addition
to FED as prescribed in First Schedule of the Federal Excise Act,
2005. For list of goods excluded from purview of this special duty
and other details see SRO 655(I)/2007.
Notification and SROs regarding Federal Excise Duty
Click here to see SROs
Federal Excise -
General Orders
Click here to see General Orders
Federal Excise -
Federal Excise Circulars
Click here to see Circulars
Federal Excise -
Federal Excise Act
Click here to see Excise Act
Federal Excise -
Federal Excise Rules
Click here to download Excise Rules
Federal Excise -
Return Forms
Click here to download Return Forms
For ntn verification visit
http://www.pakcustoms.org/online_ntn_verification/index.htm
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