CBR targets tobacco processing units involved in tax evasion
By Ali Imran

ISLAMABAD—The Central Board of Revenue (CBR) has directed tax authorities in NWFP to ensure registration of all Green Leaf Threshing (GLT) units engaged in manufacturing or processing of un-manufactured tobacco with the excise regime.
“Un-manufactured tobacco is chargeable to excise duty at the rate of Rs 5 per kg. Accordingly, all GLT units are required to get registered with the excise regime,” says a CBR notification issued here.
According to it, it has been observed that only those cigarette manufacturers that are carrying out GLT process within their registered premises do comply with the excise laws, while other GLT units operating independent from registered cigarette manufacturers are neither registered nor paying excise duty on the un-registered tobacco sale.
The CBR also directed the Collectorate Sales Tax & Excise Duty, Peshawar , to pursue such units to discharge excise obligations, which include registration, payment of excise duty, maintenance of record prescribed under the Federal Excise Act, 2005 and issuance of invoices for every transaction of unregistered tobacco sale.
To facilitate the Collectorate for immediate action, it mentioned names of such independent plants including Khyber Tobacco Mardan, Saleem Tobacco Mardan, Standard Tobacco Swabi, Mughal Tobacco Swabi, and Souvenier Tobacco Mardan.
However, it said, in case of cigarette manufacturers operating their own GLT units in their registered premises, the existing arrangement laid down the Act and rule made thereafter will continue.
It made it clear that the amount of duty such independent units paid against the sale of un-manufactured tobacco would be available to the respective cigarette manufacturers for adjustment against the duty payable on clearance or sale of cigarettes.