Ministry of Maritime Affairs Seeks Tax Exemption For Shipping Companies
Islamabad: The maritime ministry has sought a tax exemption for a time period of 20 years from 2020 to 2040 for shipping vessels. According to Express Tribune, the incumbent government is likely to extend tax exemptions on the import of ships, floating crafts and survey vessels by shipping companies.
This development comes in as part of the ministry`s aim to provide maximum relief to maritime stakeholders. the 20-year extension will be under the ambit of Pakistan Merchant Policy 2001 which already provides duty reliefs and tax exemptions.
As per sources, the existing policy is set to expire in 2020 and the ministry is all set to extend the relief for the next twenty years, primarily to protect PNSC ( Pakistan National Shipping Corporation).
“The government has constituted a ministerial committee to look into the impact of tax exemptions for the next 20 years,” a senior government official said, according to express tribune.
In the government’s support, the United Nations Framework for Developing of National Shipping Policies, such measures are necessary for maritime tourism and hence growth.
As per the ministry`s sources, once the existing policy expires in 2020, the shipping companies will be taxed t normal rate, therefore, the extension is necessary.
The said ministry is fully aware of the negative consequences that the latest tax levy after 2020 may bring to the maritime industry, in particular, affecting PNSC and future resident shipping companies.
In order to prevent the adverse impact, the maritime industry has recommended tax relief in terms of tonnage tax and exemption from sales tax, customs duty and withholding tax on the purchase of ships, according to express tribune.