The budget for the financial year 2023-2024 has been recently unveiled by the federal government, showcasing a range of significant updates. Notably, the IT and real estate sectors are set to benefit from a multitude of new relief measures. Additionally, tax rates for cash withdrawals and imports have been revised to align with the current economic landscape. Let’s delve into the key highlights of the budget for the financial year 2023-2024.
Guiding Principles
- No increase in duties on the import of essential items
- Trade facilitation and ease of doing business
- Encourage industrialization and investment
- Incentives for the agriculture sector
- Promotion of energy efficiency & conservation
- Promotion of Information Technology (IT) and IT-enabled services
Relief Measures:
- Exemption of Customs duties on specific papers and art cards and boards for the printing of the Holy Quran.
- incentive for the Pharma sector by including one more API and 03 drugs in the existing duty-free regime.
- An incentive for manufacturing Solar Panels and allied equipment by exempting customs duties on the import of machinery, equipment, and inputs.
- An incentive for exporters of Information Technology (IT) and IT-enabled services by allowing duty-free import of IT-related equipment equivalent to 1% value of their export proceeds.
- Reduction of Customs duties and additional Customs duties on import of intermediary/industrial inputs falling under 10 PCT codes.
- Exemption of Customs duties on raw materials of Diapers, Sanitary Napkins, and Adhesive Tape.
- Concession of Customs duty on raw materials/inputs for manufacturers of Capacitors.
- Reduction of Customs duty from 10% to 5% on non-localized (CKD) of Heavy Commercial Vehicles (HCVs).
- Exemption of ACD on import of raw materials of Hemodialyzers fluid/powder.
- Extension in exemption on machinery and equipment imported by erstwhile FATA areas till June 2024.
- Continuation of concession on import of Flavouring powders for food preparation for manufacturers of snacks till June 2024.
- Exemption of Customs duty on Organic Composite Solvent and Thinners for manufacturers of Butyl Acetate and Dibutyl Orthophthalates.
- Reduction of Customs duty on import of pet scrap for manufacturers of polyester filament yarn.
- Exemption of Customs duties on Raw Materials for manufacturing of Moulds and Dies.
- Exemption of Customs duties on raw materials/inputs for Mining machinery.
- Exemption of Customs duties on raw materials/inputs for Rice mill machinery.
- Exemption of Customs duties on raw materials/inputs for Machine tools.
- Alignment of Part(V) of Fifth Schedule to the Customs Act with Auto Industry Development and Export Policy (AIDEP) 2021-26.
- Exemption of Customs duties on the import of seeds for sowing to promote growth in the agricultural sector.
- Exemption of Customs duties on import of shrimps/prawns/juveniles for breeding in commercial fish farms and hatcheries.
- Exemption of Customs duties on roasted peanuts for manufacturing of ready-to-use supplementary foods (RUSF) by World Food Program certified manufacturers.
- Increase of Customs duty on Carbides of Calcium from 3% to 11% to protect the local industry.
- 23. Removal of regulatory duty on second-hand clothing to provide relief to the poor segment of society.
- Reduction of regulatory duty on 151 PCT codes pertaining to second-hand clothing, fish, tiles, and sports goods.
- Removal of regulatory duty on IT-related equipment to encourage the Information Technology sector.
- Removal of Regulatory duty on Synthetic Filament Yarn of Polyester not manufactured locally.
- Removal of Regulatory duty on parts for flat panels, monitors, projectors.
- Removal of Regulatory duty on Silicon Steel Sheets.
- Exemption of RD on special steel round bars and rods of non-alloy
- Increase/levy of regulatory duty on the import of articles of glass to protect the local industry.
- To discourage the use of inefficient Tungsten Filament Incandescent Bulbs, 20% RD is imposed on these bulbs and their parts.
- Export Regulatory Duty on the export of Molasses increased from 10% to 15%.