Prime Minister Shahid Khaqan Abbasi chaired a meeting of the Economic Coordination Committee at Prime Minister’s Office to discuss economic incentives for the people of FATA after the passage of the 31st Amendment.
The ECC approved the following tax exemptions and other incentives for the next five years for the people of FATA and PATA after the landmark 31st Constitutional Amendment.
There will be an exemption of income tax on profits and gains of existing businesses conducted by individuals in FATA for a period of five years.
These businesses however need to be registered with FBR by 30th September 2018. Additionally, exemption from paying sales tax to the retailers will also facilitate general consumers.
Domestic consumers of electricity would be exempted from sales tax as well.
The Federal Excise Act 2005 shall replace the erstwhile Central Excise Act 1944.
Non customs paid vehicles would be allowed to be used in erstwhile FATA/PATA for a period of five years ending on 30th June 2023. However, these vehicles will not be allowed to cross over to other areas of the country. After the expiry of five years’ relaxation period, the vehicles would be regularized on payment of leviable duty and taxes.
Exemption is also being offered from all withholding taxes, except on salary.
Any person seeking to set up new industrial undertaking is granted exemption from Income Tax, subject to prior approval of the ECC. The meeting discussed the issue of revocation of Neelum Jhelum surcharge and decided that the surcharge would end on achieving Commercial Operation Date (CoD) of the project.
The ECC also approved re-lending terms for Pakistan Mortgage Refinance Company Limited (PMRCL) for the purpose of ensuring efficacy of the facility towards promoting low cost/affordable housing in Pakistan.
At the conclusion of the meeting, the Prime Minister appreciated the contributions of ECC members towards taking informed decisions in the larger public interests. Secretary Finance, on behalf of the ECC members, thanked the Prime Minister for his guidance and support