20/1/06 (Daiy Times)  -   SLAMABAD: The Central Board of Revenue (CBR) has announced that no federal excise duty (FED) is chargeable on the domestic production or manufacturing of ghee and cooking oil and other edible oil.

According to a FED order issued here on Thursday, FED at the rate of Re. 1 per kg has been levied at import stage on edible oil, including crude oil as well as vegetable ghee and cooking oil in lieu of duty payable on value addition at local manufacturing stage, through Notification SRO. 24(I)/2006 dated 07.01.2006.

Subsequently, some queries have been raised seeking clarifications. Accordingly, following clarifications being issued for uniformity of compliance:

The PVMA had asked that whether payment of FED at Rs 1 per Kg at import stage, is the final liability under the Federal Excise Act, 2005. The CBR has clarified that payment of FED @ Rs 1 per Kg at import stage constitutes the discharge of final liability in respect of manufacturing/production of edible oil, ghee and cooking oil, and no Federal Excise Duty is chargeable on the domestic production of the said items.

In another query a clarification was sought that what type of returns would be required to be filed by the manufacturers of edible oil/ghee/cooking oil. The CBR has replied that a simplified Federal Excise return has been prepared for the manufacturers of edible oil, ghee and cooking oil (Annex-A), which is to be filed by the manufacturers falling in purview of above said SRO. The CBR has also clarified that crude palm oil classifiable in PCT heading 1511.1000 is covered under SRO 24(I)/2006.

The PVMA had asked whether the excise duty paid on import stage would be refundable on export of ghee/cooking oil. The CBR has clarified that under section 5 of the Federal Excise Act, 2005, drawback of duty paid on goods used in the manufacture of goods exported out of Pakistan is admissible. Therefore exporters of ghee/cooking oil are entitled to drawback of FED paid at import stage. staff report