ISLAMABAD, Aug 8: The Central Board of Revenue has notified special procedures for the collection of federal excise duty (FED) on travel tickets by air of passengers embarking on international journey from Pakistan.

The special procedures were notified through a FED notification SRO780 by amending the federal excise rules. According to the notifications, the provisions of these rules shall apply for collection and payment of excise duty by the aircraft operators in respect of travel by air of passengers within the territorial jurisdiction of Pakistan and in respect of passengers embarking on international journey from Pakistan, including chartered flights.

The duty shall not be charged from Haj passengers, transit passengers, supernumerary crew, diplomats and passengers having arrived in Pakistan from abroad on tickets issued outside Pakistan and are embarking only for return journey from Pakistan.

Head offices of the airlines and aircraft operators, if not already registered, shall apply to the Central Registration Office at Central Board of Revenue for excise registration in the form, FE-1 under Rule 3 of the Federal Excise Rules, 2005. The foreign airlines shall have the option to obtain a single registration of an authorised office or separate registrations of branch offices. In case of single registration, the centralised office shall be responsible for the payment of excise duty in respect of all the branch offices.

For the purpose of levy of excise duty on travel by air of passengers within the territorial jurisdiction of Pakistan, the services provided by the aircraft operators shall represent the total charges received from the passengers, excluding the amount of excise duty leviable thereon.

Where a passenger performs a domestic journey at concessional rate or without being charged any fare, the fare ordinarily payable for the journey shall, for the purposes of these rules, be deemed to have been paid by such passenger for the purpose of levy of excise duty.

The excise duty shall be chargeable on all international air tickets issued directly by the airlines or through their agents for the international journey starting from anywhere in Pakistan, whether such tickets are issued in Pakistan or outside Pakistan.An air ticket issued for international travel covering more than one destination on flights operated by two or more airlines shall be chargeable to excise duty by the airline issuing the ticket and shall be charged at the rate of excise duty applicable for the farther destination in terms of distance from Pakistan.

The duty under these rules shall be charged and collected by the airline itself or through its authorised sales or travel agents at the time of issuance of tickets or at the time of chartering of flights. Provided if due to some unavoidable reasons the duty is not collected at the time of issuance of tickets the same shall be charged before the boarding of the passengers on the aircraft.

The CBR has also worked out a penalty to be Rs10,000 on every such ticket the airline failed to collect the duty. No passenger will be allowed to be on board without payment of FED. The airline would file monthly return with the sales tax department.For the purpose of payment of excise duty chargeable on international air travel, no input tax adjustment shall be allowed to the airlines. The airlines shall deposit in the government treasury, the entire amount of excise duty collected on international air travel without making any deductions.