Quantifying imported petroleum products: CBR adopting new method to assess duties
SOHAIL SARFRAZ
ISLAMABAD (May 27 2007): The Central Board of Revenue (CBR) is working on a new mechanism to accurately measure the quantity of imported petroleum products for properly assessing duties and taxes. Sources told Business Recorder on Saturday that the board is likely to use technology of flow meter and auto gauge system to measure the POL products at the import stage.
Recently, a meeting was convened at the CBR House to finalise the modalities for installation of flow meters in the storage tanks containing POL products. The implementation of the new system would ensure proper quantification of the petroleum products particularly imported crude oil, which is later refined at the local refineries. The POL products are usually measured in litres for calculation of duties and taxes for which a proper measurement system needs to be put in place.
The CBR has collected net Rs 22,580 million as sales tax (domestic) on POL products during July-March (2006-2007) against Rs 20,246 million in the corresponding period last fiscal, showing an improvement of 11.5 percent.
Sources said that the idea is to use a modern technique for measuring POL products. Flow meter is a device that measures movement of fluid in a conduit or an open space. Some of the most common types of flow meters include Coriolis, magnetic, ultrasonic, vortex, turbine and multiphase.
According to the sources, currently the POL products are measured manually through dip-rods. These rods are dipped into the POL storage tanks for measurement in litres. As it is a manual system, it needs to be replaced with the specific method of measuring POL products.
The exact depth of the storage tanks is usually measured with the help of these rods. POL is transported by different means. For example, oil tanker brings POL products into the country and it is discharged at the seaport where every company has its own storage tanks.
Auto gauge system could be installed at this first stage of import of POL products. Secondly, POL products reach the oil refineries through tankers or pipelines. During the flow of POL products to refineries, the meters could be installed to check the flow/measurement of such products. Sources added that the CBR is also consulting the relevant government departments for proper implementation of the new system.
Copyright Business Recorder, 2007