Islamabad: The Federal Board of Revenue (FBR) has taken note of concerns raised by traders, stakeholders, and trade bodies regarding the proposed procedure for the non-levy of federal taxes on goods imported for exclusive consumption in Gilgit-Baltistan (GB). The FBR has clarified that a comprehensive and robust mechanism has been put in place to ensure that tax-exempted goods are not misused and that the interests of traders and the business community in the rest of Pakistan remain protected.
Gilgit-Baltistan enjoys a special constitutional status, under which certain federal tax laws—including the Sales Tax Act, 1990, the Income Tax Ordinance, 2001, and the Federal Excise Act, 2005—have not been extended to the region. In light of this status, and following representations from the Government of Gilgit-Baltistan and local traders, the federal government agreed that goods imported through the Sost Dry Port for consumption exclusively within GB will not be subject to these federal taxes at the import stage.
To maintain fiscal discipline and prevent misuse of the concession, a strict annual ceiling of Rs. 4 billion has been imposed on imports made under this arrangement for Gilgit-Baltistan.
The FBR stated that, to ensure transparent and effective implementation of the policy, several safeguards have been introduced. Under the mechanism, the Government of Gilgit-Baltistan will allocate trader-wise quotas for tax-exempt goods intended for consumption within the region, with the collective quotas not exceeding the annual cap of Rs. 4 billion.
In addition, Pakistan Customs, operating under the FBR, has developed a dedicated module within the WeBOC (Web-Based One Customs) system. This system will automatically register, debit, and monitor the allocated quotas in real time. Once a trader’s approved quota is fully utilized, the system will block any further tax-free imports, and applicable federal taxes will be charged in accordance with the law.
The FBR emphasized that these measures are designed to ensure transparency, prevent revenue leakage, and strike a balance between facilitating trade in Gilgit-Baltistan and safeguarding the interests of businesses elsewhere in the country.
