ISLAMABAD, June 9: The government on Saturday reduced customs duty on more than 400 tariff lines of raw materials and machinery, introduced a zero tariff slabs in customs tariff and announced a package of incentives for the textile industry.

Through the Finance Bill 2007, the cascading principle in tariff rates maintained as guiding principle (primary raw materials 0 per cent — 5 per cent, secondary/components at 5 — 10 per cent and finished goods at 20 - 25 per cent) and adopted the new tariff classification scheme aligned with HS 2007 version to be effective from next fiscal year.

The government has announced to give duty drawback on import of polyester staple fibre (PSF) in proportion of the duty paid on it to textile sector. The government has also allowed import of PSF under DTRE scheme.

To compensate the local manufacturers of PSF, the government will give local manufacturers of PSF a subsidy at the rate of 3.5 per cent.

It has been proposed to exempt raw material and components for local production of CNG processors, the non-conventional energy sources equipment exempted from both sales tax and customs duty; duty exempted on gum raw materials; around 14 items of poultry sector exempted from custom duty.

The government has also been zero rated on sports football bladder raw materials; duty reduced to 5 to 10 percent from 20 to 10 percent on components on electrical transformers; duty reduced to 5 to 10 percent on swittcharges raw materials, printing plates.