ISLAMABAD: The government on Thursday exempted sales tax and withholding tax on the import of tomatoes and onions for a period of four months, especially from Afghanistan and Iran, to arrest the skyrocketing prices of the vegetables in the domestic market in the aftermath of heavy rains and floods.

Tomatoes and onions are currently cleared at Torkham, Chaman, and Taftan customs border stations for a fee of 17 per cent sales tax, 3pc additional sales tax, and 1pc withholding tax. All these duties and taxes are exempt until Dec 31.

Pakistan is already importing vegetables from Afghanistan and Iran to bridge the shortfall in domestic production and cater to the rising demand. However, the government will have to look for other options to import, including India, because local crop destruction and delay in sowing cannot alone be catered to by imports from these two countries.

There are no restrictions or permit requirements for imports except in India of these products and to meet domestic quality standards.

The exemptions are not country-specific and these products can be imported from any country duty-free, according to two notifications issued by the Federal Board of Revenue (FBR). The purpose is to ease the shortages amid the destruction caused by the floods.

Tomato and onion prices in Pakistan have shot up after heavy rains led to crop damage and a shortage of these kitchen staples.

The average maximum national price of tomatoes was Rs160 per kg, according to the Pakistan Bureau of Statistics; though it is selling at as high as Rs250 per kg in several parts of the country, as are onions at Rs130, while they are selling at as high as Rs300 per kg.

Recent floods have brought unprecedented crop damage. As a result, the prices of onions and tomatoes have skyrocketed in the local markets. The elimination of all taxes and duties on procuring the two vegetables by import will help reduce their prices.

Earlier, FBR issued five SROs, which exempted from duties and taxes all goods that are needed for flood relief operations as certified by the National Disaster Management Authority or Provincial Disaster Management Authority. Furthermore, the receipt of donations and relief aid has also been exempted.

Official data available to Dawn showed that the total import of onions from Afghanistan at Torkham border station in Khyber Pakhtunkhwa stood at 990 vehicles between July and August 2022, while that of tomatoes stood at 4,100 vehicles during the same period.

The average quantity of tomatoes and onions per truck ranges from 20 tonnes to 34 tonnes depending on the size of the vehicles. The average tax is Rs8,200 per tonne of onions and Rs580 per tonne of tomatoes. Onion prices are expected to see the most relief.

In July and August 2022, the quantity of imported tomatoes at Torkham stood at 103,142 tonne while that of fresh onions was 16,176 tonnes.

In Balochistan, the import of onions from Afghanistan at the Chaman border stood at 209.05 tonnes between January and August. It was only in the month of August that the import of tomatoes started from Afghanistan via Chaman border station, which stood at 19 tonnes.

Data shows the import of tomatoes from Iran to Balochistan via different customs stations, including Taftan, stood at 1771 trucks of fresh tomatoes transported to Pakistan between January and August 2022, while 142 trucks of fresh onions, respectively.

In quantity terms, the total quantity of fresh tomatoes imported stood at 39716.852 tonnes between July and August 2022, while that of fresh onions stood at 2731.788 tonnes, respectively.

Published in Dawn, September 2nd, 2022