KARACHI: Sack Kraft Manufacturers Association has proposed FBR to rationalize and reduce the current custom duty on sack craft paper to 5% in the upcoming budget of 2014-2015 as an initiative to promote the environmental friendly packaging material.
The Association mentioned that Custom Duty on Sack Kraft Paper under PCT Code: 48042100 & 4804.2900 — is being charged at 15% while the same on Polypropylene Granules is charged at 5% thus enabling the PP Granule importers to enjoy the duty benefit of 10% despite the fact that both the products are the basic raw material for the finished products.
Sources said that WPP bags are neither environment friendly nor biodegradable because it is impossible to recycle WPP bags as cancerous dioxins are released in the process. Moreover, the raw material for WPP (being polypropylene granules) is derived from oil which itself is becoming scarce.
They mentioned, “In developed countries only sack kraft paper bags are used for cement packaging whereas Woven Polypropylene (WPP) bags are hardly used on account of environmental considerations. The WPP bags are mainly used in developing countries of Asia and Africa where the environmental considerations are still not on the priority list.”
It is worth mentioning that the polypropylene sacks were introduced as the concept of Oxo Degradable plastic that provides the solution to the littering problem but it does not make plastic degradable. The breakdown process of plastic compound to microscopic level is considered dangerous and is banned in European countries.
On the contrary, Sack Kraft paper is recognized globally as environmentally friendly packaging due to its recyclable nature and it does not contribute to any deforestation as it is not produced locally on behalf of the scarcity of long fibre wood and production process requirement.
They said that Sack Kraft Paper is being imported for the production of high quality performance grade multi-ply paper sacks for packaging & safe handling of voluminous weights under demanding conditions, primarily to meet the requirement of the local cement industry.
They further added that paper sacks, after serving their primary purpose, are reused to make other paper products and recycled by the local paper industry to produce different grades of paper for local consumption.
By rationalizing the customs duty, FBR can eliminate tax anomaly that has put the paper bag manufacturers at disadvantage as the WPP bag makers have been able to sell their bags at relatively lower prices on account of this duty advantage.