ISLAMABAD: The federal government has approved a major tax relief package for Gilgit-Baltistan, allowing the duty- and tax-free import of hundreds of items through the Sost Customs Dry Port, subject to an annual exemption cap of Rs4 billion.
The facility has been introduced through a notification issued by the Federal Board of Revenue (FBR) under the Customs Act 1969, Sales Tax Act 1990, Federal Excise Act 2005 and Income Tax Ordinance 2001, and has taken effect immediately.
Under the new framework, only goods imported via the Silk Route Dry Port at Sost and classified under specified Pakistan Customs Tariff (PCT) codes listed in the notification will qualify for the exemption. Sales tax, income tax and federal excise duty will not be levied, provided each consignment carries online authorisation issued by the duly notified Gilgit-Baltistan government authority through the Customs Computerised Clearance System. The importing firm must also be wholly owned by persons holding Gilgit-Baltistan domicile.
The cumulative tax exemption has been capped at Rs4bn per financial year and will be granted on a first-come, first-served basis through the computerised customs system. Once the quota is exhausted, all subsequent imports for consumption in Gilgit-Baltistan will be subject to full taxation.
The notification places strict responsibility on the Gilgit-Baltistan government to ensure that goods imported under the facility are used exclusively within the region. In cases of misdeclaration or if goods are found to have been moved outside Gilgit-Baltistan, the Collector of Customs is authorised to immediately withdraw the exemption. The Chief Collector of Customs (Enforcement) has also been directed to take effective measures to prevent the onward movement of such goods.
The rules further allow for the temporary suspension of the tax exemption if customs operations are disrupted due to protests, sit-ins or road blockages, following consultation between the Collector of Customs Gilgit-Baltistan and the provincial government.
The FBR has been tasked with developing a dedicated monitoring and tracking mechanism to clearly identify and regulate goods imported for Gilgit-Baltistan.
