Daily Times

The Federal Board of Revenue (FBR) has issued a draft of rules for new Export Facilitation Scheme 2021 and sought comments from industry, exporters and other stakeholders.

According to FBR press statement issued here Saturday, the New Export Facilitation Scheme has been approved by the federal government and passed by Parliament under Finance Act 2021. This scheme would be implemented from August 14, 2021 and would run parallel with existing schemes like Manufacturing Bond, DTRE and Export Oriented Schemes for two years.

The existing old schemes would be phased out in next two years and would be fully replaced by Export Facilitation Scheme-2021, the statement said adding that the draft rules could be accessed at official website of FBR.The Salient Features of new EFS-2021 include minimum documentation and encourages new entrants and SMEs.

The statement said, the Scheme would be completely automated under Web Based on Customs (WeBOC) and Pakistan Single Window (PSW). The focus of the scheme is on post clearance compliance checks and audits while the users of this Scheme include Exporters (Manufacturers cum Exporters, Commercial Exporters, Indirect Exporters), Common Export Houses, Vendors and International Toll Manufacturers.

The users should be subject to authorization of inputs by the Collector of Customs and Director General Input Output Organization (IOCO). Inputs include all goods (imported or procured local) for manufacture of goods to be exported like raw materials, spare parts, components, equipment, plant and machinery.

No duty and taxes would be levied on inputs imported by the authorized users and local supplies of inputs to the authorized users shall be zero rated. Through this new scheme concept of Common Export House to import raw material duty and tax free for subsequent sale to the authorized users especially SMEs has been introduced.

This Scheme also introduces concept of International Toll manufacturing. Under this new Scheme, utilization period has been enhanced from two years to five years depending on the profile/category of exporters. It is expected that Export Facilitation Scheme 2021 would reduce cost of doing business and cost of tax compliance, improve ease of doing business, reduce liquidity problems of exporters by eliminating Sales Tax refunds and Duty Drawback for the users of Scheme and shall attract more users and shall ultimately promote exports.