The Special Economic Zones (Amendment) Act, 2016 (Government Bill)

The Special Economic Zones (Amendment) Act, 2016 (Government Bill)

Proposed and moved by: Mr. Sheikh Aftab Ahmed (Member, National Assembly, State Minister for Parliamentary Affairs).

Status: Passed (By National Assembly)

Summary: (Islamabad, Pakistan): The National Assembly on 19 May 2016, passed the Special Economic Zones (Amendment) Bill 2016, which aimed to further amend the Special Economic Zones Act, 2012.

The 2016 Amendment Act has redefined ‘Special Economic Zones’ as a geographically defined and delimited area. It also categorizes who may avail Special Economic Zone enterprise benefits by virtue of an amendment to s.15 (2) of the 2012 Act. S.37 of the 2012 Act has been amended and focuses on exemption from custom-duties and taxes.

The purpose of SEZ Act 2012 was to stimulate industrial growth in Pakistan by providing infrastructure facilities and special exemptions to industrialists. From the commencement of Special Economic Zones (Amendment) Ordinance, 2015 (XVIII of 2015), only new entrants setting up businesses after establishment of SEZ may receive these enterprise benefits under the Special Economic Zones Act.

The main objective behind the Special Economic Zones (Amendment) Act, 2016 is to bring Special Economic Zones within the ambit of the customs area. This would in turn grow the Special Economic Zones market by making it more investment and business friendly.

New amendments included SEZs to be within the customs territory of Pakistan and zone enterprises to sell their products in domestic market without payment of customs and other duties. The Act provides free imports for economic zones’ developers of plant, machinery and other heavy equipment. It also provides tax holidays of 10 years for them. This investor friendly law would encourage rapid industrialization and economic growth, creating more jobs and infrastructure facilities for people in Pakistan, hence play a key role in establishing prosperity in the country.

 

(Summary by Umaima Masood and Anam Asad Khan)



Related posts