Mohsin Siddiqui (Chief Reporter)
The Federal Cabinet has taken significant steps to ensure that genuine humanitarian donations and gifts can be granted tax exemptions without requiring Cabinet approval. This move aims to expedite the distribution of much-needed aid, particularly in the form of medicines, food supplements, and relief goods, to recipients across Pakistan.
The National Health Services, Regulations & Coordination (NHSR&C) Division recently briefed the Cabinet on the pressing issues related to maternal health in Pakistan. The Division highlighted alarming nutrition deficiencies among pregnant women, revealing that 35.5% of women in the reproductive age group suffer from anemia, 46.9% from iron deficiency, 81.2% from Vitamin-D deficiency, 27% from Vitamin-A deficiency, and 32.6% from calcium deficiency. These deficiencies pose significant health risks for both mothers and their babies.
In response to these health challenges, the World Health Organization (WHO) has recommended the use of the United Nations International Micronutrient Antenatal Preparation, which includes 15 essential micronutrients known as Multiple Micronutrient Supplement (MMS) for pregnant women. This supplement aims to address the micronutrient deficiencies and improve maternal health outcomes.
Two US-based philanthropic organizations, Kirk Humanitarian (KH) and the Junaid Family Foundation (JFF), have been pivotal in donating MMS to pregnant women in Pakistan. These donations have previously arrived tax-free due to a blanket approval granted by the Government of Pakistan during the COVID-19 pandemic and Flood Emergency. The latest shipment, consisting of 1,036,800 bottles of MMS, is currently awaiting customs clearance at Karachi seaport.
The NHSR&C Division approached the Federal Board of Revenue (FBR) on March 26, 2024, to seek tax and duty exemptions for the shipment under PCT Code 9913. However, the FBR responded on March 28, 2024, stating that exemptions under this code are only available to hospitals and institutions classified as Non-Profit Organizations, which does not include the NHSR&C Division. Instead, the FBR advised the Division to seek exemptions under PCT 9908(i), which allows for tax and duty exemptions on goods received as gifts or donations, contingent on the Federal Government’s recommendation and FBR’s concurrence.
Acknowledging the procedural delays in obtaining exemptions, the Cabinet has directed the FBR to grant tax and duty exemptions without delay for all genuine cases of donations within its purview. This directive specifically targets donations such as medicines, food supplements, and relief goods to prevent perishable items from spoiling and to ensure their swift distribution to those in need. The Cabinet emphasized the need to streamline and simplify procedures for granting these exemptions, while also ensuring the verification of the genuineness of such cases.
For cases beyond the FBR’s competence, the Cabinet has instructed the Revenue Division to process amendments to existing laws and rules. These amendments aim to ensure that genuine humanitarian donations and gifts can be granted exemptions from taxes and duties without requiring Cabinet approval. This change is expected to facilitate faster processing and delivery of aid, enhancing the effectiveness of humanitarian efforts.
The Cabinet has also directed all Ministries and Divisions, including the NHSR&C Division, to process all cases of donations expeditiously. By doing so, the government aims to address the urgent needs of vulnerable populations, particularly pregnant women, who are facing severe nutritional deficiencies.
