20th March 2020
EP Report

The National Board of Revenue (NBR) has tightened the rules regarding duty-free import power plant equipment in a bid to curb abuse of the privilege through import of materials not directly related to power plant construction.


The revenue administration listed 20 items -- including steel sheet, rod, cement, household goods, office furniture, dredger, anchor boat and vehicles -- that are outside the purview of zero-duty import benefit for power plants, according to a notification issued recently.


The list comes based on a recommendation from a panel formed by the NBR last year as items as random as dredger, boulders, steel sheets and pipes were imported duty-free in the name of power plant construction.


This gave rise to fears of revenue loss among customs officials.


Subsequently, the revenue authority has decided to barricade items unrelated to power generation from the exemption benefit.


Since 1997 the customs authority has been offering the privilege to public and private power producing companies to import machinery, spare parts and materials needed for erecting the plants.


However, no specific list of products was mentioned in the notification.


And in the absence of clarity, products not directly related to power plants were being imported by firms based on recommendations from the Power Division.

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