Minister of State for Railways, Finance and Revenue Bilal Azhar Kayani has announced that the government has increased the utilisation period under the Export Facilitation Scheme (EFS) from nine months to 18 months.

This essentially means that exporters can now avail of zero duty and import-stage taxes for inputs provided they are used within 18 months (previously nine months). The longer utilisation period will reduce the cost for the exporters and will particularly help the small and medium-scale (SME) exporters.

An additional extension of six months, beyond the 18-month utilisation period, will be considered by a committee on a case-by-case basis. A six-month reconciliation statement will help safeguard the EFS from abuse.

The state minister expressed gratitude to colleagues in the Federal Board of Revenue (FBR) and the Ministry of Commerce and to partners from the private sector for working with him in the technical committee, which unanimously recommended policy changes to the prime minister.

The committee studied the historical EFS data and utilisation period benchmarks of regional peers before finalising its recommendations. Before the policy change, there were a total of 7,932 Goods Declarations (GDs) for input materials, which exceeded the nine-month ceiling. After the extension to 18 months, all these GDs are now again eligible for exports under the EFS. Kayani mentioned that two additional improvements had also been made – the automatic replenishment of security deposit to the extent of the amount of goods consumed and exported, which will save exporters time, and the right of appeal for EFS users to the chief collector against orders of the regulatory collector.