The Federal Board of Revenue (FBR) has issued Gwadar Tax-Free Zone Rules 2021 for the guidance of investors and companies operating at Gwadar Tax-Free Zone.
Under the draft rules issued by the FBR, the investors and companies operating at Gwadar Tax-Free Zone would have to pay duties and taxes on the disposal of exempted plant, machinery, equipment, and apparatus before the expiration of five years of import of such goods.
According to the rules, the Zone shall be fenced and bound with a secure boundary wall and shall remain under 24-hour customs surveillance/supervision. Suitable check posts shall be established to the satisfaction of the Collector of Customs.
The Zone Authority shall fix CCTV infrastructure at all entry/exit points and also along the boundary wall. The camera feeds shall also be provided to the Customs for enforcement controls.
All entry and exit points of the free zone shall be under the supervision of the regulatory Collectorate. The construction of the check posts and their maintenance shall be carried out by the Authority or concession holder in accordance with the layout plan approved by the Collector of Customs.
The goods declaration in respect of goods imported for a free zone along with other documents shall be presented. The goods declaration shall be filed by the investor, or a clearing agent duly authorized. The goods imported into a free zone shall be examined and assessed in accordance with the provisions of the Customs Act, 1969 and rules made thereunder.
The exemption granted under the Customs Act and Gwadar Port Authority Ordinance, 2002 shall be applicable to plant, machinery, equipment, apparatus and materials to be used solely within the limits of a free zone and to goods imported into the zone by the investors. Provided that plant, machinery, equipment, and apparatus including capital goods imported shall be retained for a period of at least five years from the date of importation: Provided further that the disposal of plant, machinery, equipment, and apparatus.
Duty and tax-free vehicles shall be allowed to be imported by the concession holder and its operating company for construction, development, and operations of Gwadar Port and free zone area under the regulatory mechanism. The regulatory mechanism for such vehicles, including the number and types importable, shall be devised by the Ministry of Port and Shipping and FBR, in consultation with the Provincial Government if so required, and shall be, notified by the FBR.
An investor providing logistic services may import vehicles and equipment, free of leviable duty and taxes proportionate to their operational requirements determined under the regulatory mechanism devised and after a recommendation from the Authority.
The concession holder, its operating companies, and contractors/subcontractors may import materials and equipment (plant, machinery, appliances, and accessories), exclusively for construction and operation of the terminals and the free zone area subject to filing a goods declaration to that effect.
The “concession holder” means China Overseas Ports Holding Company Limited or any other company having rights from the Gwadar Port Authority to develop, manage and operate Gwadar Free Zone in terms of concession agreement signed under Gwadar Port Authority Ordinance, 2002, the rules added.