Pkrevenue.com

Month: May 2019

  • National Bank declares 14.5 percent decline in after tax profit on imposition of super tax

    National Bank declares 14.5 percent decline in after tax profit on imposition of super tax

    KARACHI: National Bank of Pakistan (NBP) has declared 14.5 percent decline in after tax profit for the first quarter ended March 31, 2019 due to imposition of super tax.

    Meeting of the Board of Directors (BoD) of NBP was held on Wednesday at Bank’s Head Office in Karachi in which the BoD approved the financial statement of the Bank of the quarter ended March 31, 2019.

    The after tax profit for the quarter ended March 31, 2019 was at Rs4.2 billion, which was 14.5 percent lower when compared with Rs4.9 billion in the corresponding period of the last year.

    The bank attributed the decline in profit to imposition of super tax which was imposed through Finance Supplementary (Second Amendment) Act, 2019 for the tax year 2018 (financial year ended December 31, 2017.

    Pre-tax profit of the bank was at Rs8.7 billion for the period under review as against Rs7.6 billion for the corresponding quarter of 2018, registering 14.5 percent increase.

    The bank earned mark-up/ interest income amounting to Rs45.8 billion which is 45.9 percent higher than Rs31.4 billion earned during the corresponding period last year.

    This growth is attributed to the increase in discount rate, as well as a volumetric growth in both investment and advances, YoY.

    Also, the Bank’s non mark-up / interest income increased by 40.2 percent YoY and amounted to Rs8.3 billion.

    The bank’s unconsolidated pre-provision profit amounted to Rs10.98 billion which is 45.2 billion higher than Rs7.6 billion for the corresponding period o the last year.

    Earnings per share amounted to Rs1.97 as against Rs2.30 for the corresponding quarter ended March 31, 2018.

    The total assets of the bank as at March 31, 2019 stood at Rs2,401.8 billion as compared with Rs2,798.6 billion as on December 31, 2018, registering decline of 14.2 percent.

    Gross advances of the bank amounted to Rs1,046.1 billion which is slightly lower than Rs1,059.5 billion as on December 31, 2018.

    However, YoY, total advances registered increase by Rs176.6 billion or 20.3 percent as compared to Rs869.5 billion as of March 31, 2018.

    Total deposits of the bank as on March 31, 2019 amounted to Rs1,778.7 billion, lower by Rs232.7 billion (11.6 percent) as against Rs2,011.4 billion as of December 31, 2018. The drop was observed due to withdrawal of deposits by certain financial institutions. Customer deposits that from the core of bank’s funding pool however remained stable.

  • SBP raises record Rs3,100 billion through MTBs auction at cut-off yield higher than key policy rate

    SBP raises record Rs3,100 billion through MTBs auction at cut-off yield higher than key policy rate

    KARACHI: The State Bank of Pakistan (SBP) has raised record huge amount of Rs3,100.71 billion through an auction of Market Treasury Bills (MTBs) at a cut-off yield much higher than the key policy rate of 12.25 percent.

    The central bank on Wednesday received bids in 3- and six-month treasury bills worth Rs3,176.56 billion at face value of Rs3,268.59 billion. The SBP has not received bids for 12-month treasury bills.

    The SBP accepted bids of Rs3,100 billion at face value of Rs3,190 billion. The central bank accepted Rs3,099 billion against three-month MTBs at face value of Rs3,188.99 billion at cut-off yield of 12.7495 percent. For benchmark six-month treasury bills an amount of Rs1.41 billion were accepted at face value of Rs1.5 billion and at cut-off yield of 12.80 percent.

    The amount raised was much higher than the target set for this auction. The central bank had set Rs600 billion target for the auction.

    Market analysts said that banks were still anticipating further increase in interest rate in next monetary policy announcement.

    In the recent monetary policy the SBP increased the key policy rate by 150 basis points to 12.25 percent for next two months starting May 21, 2019.

    The SBP conducts auction of securities for the government to meet budgetary deficit. The fiscal deficit has been increased to 5 percent during July – March 2018/2019, which is already cross the target of 4.9 percent for full fiscal year.

  • FBR issues Urdu version of Tax Amnesty Scheme – 2019

    FBR issues Urdu version of Tax Amnesty Scheme – 2019

    ISLAMABAD: Federal Board of Revenue (FBR) on Wednesday issued Urdu version of presidential ordinance for Tax Amnesty Scheme – 2019.

    The FBR said that the Urdu translated version had been issued for the facilitation of people to understand the scheme and participate/avail proactively.

    However, the FBR said that the translated version can not be referred anywhere and English version will be treated as authentic document.

  • New petroleum policy to offer incentives to foreign E&P companies: Imran Khan

    New petroleum policy to offer incentives to foreign E&P companies: Imran Khan

    ISLAMABAD: Prime Minister Imran Khan has said that the government is working on a new petroleum policy, which will offer incentives to foreign exploration and production (E&P) companies.

    The prime minister said this at a meeting with Chief Executive Officer Kuwait Petroleum Shaikh Nawaf Saud Al-Sabah, along with his delegation, which called on Prime Minister Imran Khan at Prime Minister’s Office on Wednesday.

    The prime minister said that in order to capitalize the existing potential of the sector, the fovernment was working on a new petroleum policy offering incentives to foreign exploration and production (E&P) companies and removing impediments in way to undertaking smooth and profitable business ventures.

    Minister for Energy Omar Ayub Khan, Minister Energy Punjab Dr. M. Akhtar Malik, Secretary Petroleum Mian Asad Hayauddin and senior officers were also present during the meeting.

    Shaikh Nawaf Saud Al-Sabah briefed the Prime Minister about Kuwait Petroleum’s business ventures in Pakistan since 1980s in the area of exploration.

    He evinced keen interest in further expanding business activities in the country.

    The prime minister welcomed Shaikh Nawaf Saud Al-Sabah and his delegation to Pakistan and assured Government’s continued support to the company in their smooth business operations.

    The prime minister highlighted various steps that the present Government has taken for improving ease of doing business and facilitation of foreign investment.

    The prime minister observed that exploration remained a neglected area in past.

    Imran Khan appreciated company’s contribution towards imparting training to the local manpower in E&P sector.

    Minister Energy Punjab Dr. M. Akhtar Malik also briefed the meeting about various initiatives being taken by Punjab Government in Petroleum sector.

  • FBR chairman warns unregistered industrial, commercial consumers of penal action

    FBR chairman warns unregistered industrial, commercial consumers of penal action

    ISLAMABAD: Syed Muhammad Shabbar Zaidi, Chairman, Federal Board of Revenue (FBR) Wednesday warned industrial and commercial consumers of gas and electricity to get registered with sales tax authorities, otherwise penal action will be initiated from July 01, 2019.

    Addressing a press conference, he said that currently there were around 341,174 industrial electricity connection and 7000 industrial gas connections, however compared to this the sales tax registration of industry was just 38,937, which he said was a huge gap.

    “It is my request to all industrial consumers to take advantage of the scheme before June 30 and may be it (the scheme) do not remain in the same shape after July 1st,” so the people using industrial utility connections should take advantage, the Chairman added.

    He said that there were possibilities that these industrial consumer connections might include some connections that come under cotton industry under law, however, added that there was dire need to check this huge difference.

    “It would be our desire that under the special clause placed in Asset Declaration Scheme, the industries falling in the category pay two percent to clear past liabilities,” the chairman added.

    He said that after July 1st, the FBR would make necessary legislation to get these industries and manufacturers registered and would also take actions.

    He urged the industrialists and manufacturers to take advantage of the Asset Declaration Scheme and clear their past sales tax liabilities by paying just two percent tax till June 30, 2019 or the law would take its due course after the expiry of the data.

    “A special clause has been included in the Asset Declaration Scheme, which was not included in it earlier, which is that if anybody is having sales tax liability he or she may clear these by paying just two percent tax,” the Chairman FBR, Muhammad Shabbar Zaidi said while addressing a press conference at FBR house here.

    He urged the media to sensitize people on the issue so that those avoiding to clear their past sales tax liabilities might realize this gap and get registered with FBR by taking advantage of the Asset Declaration Scheme.

    He said that the FBR would try its best to make it voluntary and do not indulge in harassment, as it wanted to create environment for the businesses.

    To a question, the FBR Chairman said that there were around 3.1 million commercial consumers, however added that the strategy on how to get the unregistered consumers to get registered with FBR would be shared with media.

    To another questions, the Chairman FBR said that there were over one lack companies registered with the Securities and Exchange Commission of Pakistan (SECP), however just 50,000 were filing their returns.

    He said that it was high time for those having industrial connections to get registered with FBR and take benefit of the Tax Declaration Scheme.

    It is pertinent to mention here that the government last week had announced Asset Declaration Scheme, providing one more opportunity to all Pakistani citizens to declare and legalize undisclosed assets inside and outside the country by paying just four percent taxes on all assets other than real estate.

    The scheme would be applicable till June 30, and all Pakistan citizens, other than those holding public offices or their dependents, would be able to take benefit from it.

    The basic purpose of the scheme was to document economy and make the dead assets functional to promote economy by encouraging businessmen to participate in the legal economy.

  • Stock market recovers 1195 points on hopes of state fund buying

    Stock market recovers 1195 points on hopes of state fund buying

    KARACHI: The stock exchange recovered around 1195 points on Wednesday on the hope of buying through state fund.

    The benchmark KSE-100 index closed at 34,637 points as against 33,442 points showing an increase of 1195 points.

    Analysts at Arif Habib Limited said that the market is showing signs of a bull run in the wake of the State Fund that will likely buy scrips of State owned listed entities.

    On the whole, market shot up by 1256 points during the session, and closed +1195 points. Majority stocks hit upper circuit including index blue chips OGDC, PSO, SNGP, NBP and otherwise traded in green zone throughout the session.

    Volumes maintained the healthy stride of 150M plus for the third consecutive session and today crossed 200 million shares mark. Banking sector led the volumes table with 44 million shares, followed by Technology (32 million) and Power (19 million) Sectors.

    Among banking sector BOP marked hefty volume of 25 million shares, followed by WTL (20 million) in Technology Sector.

    Sectors contributing to the performance include E&P (+269 points), Fertilizer (+219 points), Banks (+216 points), Power (+116 points) and Cement (+96 points).

    Volumes increased significantly from 153.6mn shares to 203.5mn shares (+32 percent DoD). Average traded value, however, increased by 1 percent merely to reach US$ 35.2 million as against US$ 34.9 million the other day.

    Stocks that contributed significantly to the volumes include BOP, WTL, KEL, PIBTL and UNITY, which formed 40 percent of total volumes.

    Stocks that contributed positively include OGDC (+93 points), PPL (+93 points), HUBC (+73 points), ENGRO (+66 points) and HBL (+65 points). Stocks that contributed negatively include BAFL (-8 points), INDU (-5 points), JLICL (-4 points), ICI (-2 points) and COLG (-2 points).

  • Rupee maintains level against dollar after significant decline

    Rupee maintains level against dollar after significant decline

    KARACHI – The Pakistani Rupee displayed resilience on Wednesday, maintaining its level after a series of continuous declines against the US Dollar in the interbank foreign exchange market.

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  • FPCCI expresses concerns over policy rate hike

    FPCCI expresses concerns over policy rate hike

    KARACHI: Federation of Pakistan Chambers of Commerce and Industry (FPCCI) has expressed concerns over recent significant rise in key policy rate by State Bank of Pakistan (SBP).
    In a statement on Wednesday Engr. Daroo Khan Achakzai, President of the Federation of Pakistan Chambers of Commerce and Industry (FPCCI) showed his serious concern over the hiking of policy rate by another 150 basis points in view of prevailing inflation, devaluation of currency and twin deficit in Pakistan.
    He added that SBP continues to operate a tight monetary policy despite the clear evidences that this policy strangulates investment and hampered the economic activities in Pakistan in Pakistan.
    He underlined that the IMF bailout package will further create burden on poor segment of society in terms of rising utility prices which will ultimately increase inflation in the economy.
    At present, every Pakistani possess a debt of one lac fifty nine thousands rupees.
    The President FPCCI termed the contractionary monetary policy as an anti-investment policy which has declined the economic activities in the first ten month of the current fiscal year due to declining of large scale manufacturing and service sector.
    He indicated that 12.25 percent policy rate is very high compared to regional economies like India 6.0 percent, China 4.35 percent, Sri Lanka 9.0 percent, Thailand 1.75 percent, Indonesia 6.5 percent, Malaysia 3.00 percent etc.
    While commenting on the devaluation of currency, he stated that the rising of exchange rate will increases the prices of imports particularly petroleum products which comprises 30 to 35 percent import bill of Pakistan.
    He suggested the government to intervene in the economy for currency stabilization and control of inflation. He said that the present inflation rate is 7.0 percent which is high compared to last year same period 3.8 percent; but this inflation is cost push inflation which can’t be controlled through demand management policies.
    The major cause of rising inflation in the country is high cost of doing business particularly utility prices, increase in the prices of industrial inputs and shortage of essential items of daily necessity.
    The Government should focus to increase the demand for credit by declining interest rates and make easy access to finance. Globally, the aim of monetary policy is to protect the value of the currency in co-ordination with the fiscal policy in order to achieve the objectives of macro-economic stability with constraining inflation and expansion of private sector investment, he added.
    The President FPCCI further stated that the government should create its own fiscal space for financing its expenditures instead of borrowing from SBP and other institutions. During the first ten month of year, there was an expansion in private sector credit, but is largely attributed to working capital due to rising of input prices.
    This private sector credit should be expanded to agriculture and industrial sector which are showing declining growth trend, he suggested.

  • FBR restructuring proposed to make autonomous body

    FBR restructuring proposed to make autonomous body

    KARACHI: The government has been proposed to make Federal Board of Revenue (FBR) as an autonomous body on similar line as State Bank of Pakistan.

    The Overseas Chamber of Commerce and Industry (OICCI) in its budget proposals for 2019/2020 suggested restructuring of FBR as an independent governing body.

    It suggested that FBR should be made an autonomous body on similar lines as State Bank of Pakistan, SECP, and Internal Revenue Services (IRS) of United States.

    FBR should operate and work in a corporate governance structure with a Board of Directors, vested with powers like that of the Boards of Public listed companies.

    The Chairman of FBR and fifty percent of the Board members may be nominated by the government (Ministries of Finance, Law, and Commerce) and, the remaining fifty percent Board members should be nominated by bodies like OICCI, PBC and ICAP.

    A transparent accountability system in tax administration should be introduced, and reasonable independence and empowerment given to various operational positions.

    The external audit of FBR should be done annually, by an independent international audit firm whose report should be presented and fully discussed in the Tax Policy Board meeting.

    There should also an Internal Audit function within the FBR for an effective ongoing internal audit reporting directly to the independent members of the Board nominated by the Trade bodies.

    Apart from revenue collection a key function of the FBR should be to address coordination issues between federal and provincial revenue authorities, with monthly meetings to ensure ease of doing business for taxpayers.

  • Car imports massively fall by 45pc in 10 months

    Car imports massively fall by 45pc in 10 months

    KARACHI: The import of motor cars sharply declined by 45 percent during first ten months of current fiscal year owing to restriction imposed of duty and tax payment through foreign currency account and verification of remittances through banks.

    According to officials statistics made available to PkRevenue.com on Tuesday, the import of cars in completely built unit (CBU) was at $213.37 million during July – April 2018/2019 as compared with $388.835 million in the corresponding period of the last fiscal year.

    The ministry of commerce through SRO 52(I)/2019 dated January 15, 2019 imposed the restriction of payment of duty and taxes through foreign remittances.

    The SRO stated: “All vehicles in new/used condition to be imported under transfer of residence, personal baggage or under gift scheme, the duty and taxes shall be paid out of foreign exchange arranged by Pakistan Nationals themselves or local recipient supported by bank encashment certificate showing conversion of foreign remittance to local currency, as under,

    a. the remittance for payment of duties and taxes shall originate from the account of Pakistani national sending the vehicle from abroad; and

    b. the remittance shall either be received in the account of Pakistani national sending the vehicle from abroad or, in case, his account is non-existent or inoperative, in the account of his family.”

    The customs sources said that the besides restrictions of the ministry of commerce the import of cars was also declined due to restriction on non-filers of income tax in registration with provincial registration authorities.

    Through Finance Act, 2018 the government imposed ban on non-filers for registering both imported and locally assembled cars. The government, however, lifted the ban on non-filers through Finance Supplementary (Second Amendment) Act, 2019 only for locally assembled cars.