Sugar to sell at Rs33.35 per kg NOW

The government has now fixed the ex-factory price of sugar at Rs33.35 per kg, inclusive of 15 per cent general sales tax, to control its price in the domestic market.

Mills would now have to pay GST on the fixed value of Rs29 per kg instead of earlier trend of declaring different values by different mills.

With the fixation of ex-factory sugar price (Rs29 per kg value sugar plus Rs4.35 GST), the government expected that the the commodity’s price would come down from Rs38 per kg to Rs37.

The decision was announced through two different sales tax notifications issued by the Central Board of Revenue late Saturday night.

According to the notifications, the CBR fixed the value of “taxable supply of locally-manufactured white crystalline sugar at Rs29 per kg for assessment of GST.”

It said: “While the value of crystalline sugar at import stage for the GST was fixed at the rate of $440 per metric ton (Which comes to Rs29 per kg in rupee terms).”

A senior tax official said that the CBR had fixed the value of sugar for tax purposes after noticing that different mills had declared their product’s price at different rates, ranging from Rs28 to Rs32 per kg.

The variation in ex-factory price would now be removed at both domestic and import stages, the official said, adding that it was hoped that it would help reduce the sugar price soon. He said that it would also help remove the possibility of any unexpected increase in sugar price, which at one stage crossed Rs40 per kg.

According to the official, the CBR had recently posted tax officials in 79 sugar mills across the country on the directive of the finance ministry to monitor production, clearance and procurement of sugarcane.

An analytical report was compiled by the CBR on the information collected by these officials.

The report noted a reduction of around 18 per cent in clearance of sugar from 34 mills during the current season.

The report showed that the average price of sugar in most mills was reported to be Rs26 per kg on Feb 6, excluding sales tax.

About eight mills had projected an average price of Rs28-30 per kg while two others had declared a price of Rs31 per kg.

The official Central Board of Revenue expressed the hope that registration row between traders and the Sindh Food Department would be resolved soon.

The department had recently asked all traders, who dealt in quantities of more than 60 tons of sugar, to register with the department along with filing of monthly statements.

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