KARACHI: Builders and developers are required to discharge tax liability for tax year 2020 with the tax return. Commenting on Tax Laws (Amendment) Ordinance, 2020, tax experts at PwC A Ferguson said that the annual tax liability for a project is to be computed by dividing the total liability of the project under the regime by the estimated life of the project in years (which shall not exceed 2.5 years).
(more…)Day: April 25, 2020
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Weekly Review: market likely to stay range bound due to Ramazan
KARACHI: The trading activities in the stock market likely to stay range bound during next week due to commencement of the holy month of Ramazan.
Analysts at Arif Habib Limited said that market to remain range bound in the upcoming week.
With commencement of the month of Ramazan, volumes may dry down. While extension in lockdown by the Federal government to contain the spread of Corona may also build pressure on businesses and keep sentiment at the index lackluster.
The benchmark KSE-100 index of Pakistan Stock Exchange (PSX) is currently trading at a PER of 6.9x (2020) compared to Asia Pac regional average of 10.2x and while offering DY of around 8.5 percent versus around 3.1 percent offered by the region.
The market commenced on a positive note, continuing the unpreceded rally witnessed on last Friday over SBP’s surprise rate cut of 200bps.
Albeit, the euphoria was short lived with investors parring earlier gains as banks felt the heat of compression in NIMs while oil scrips tanked with international oil prices.
The local bourse displayed a mixed trend for the remainder of the week. Initially leveraged stocks gained traction (cements and steel; amid rate cut and news of potential price hikes) but market participants resorted to profit-taking by week-end as results disappointed.
Whereas sentiment of the banking sector was eroded with the State Bank barring banks from declaring dividends in the March and June quarter of the ongoing year so as to conserve capital.
Albeit, large banks posted gains the following day on clarity regarding disbursement provision in case of board approved dividends for the outgoing quarter. With that said, the KSE-100 closed at 32,806 points (down by 0.08 percent / 25 points WoW).
Sector-wise negative contributions came from i) Oil & gas exploration companies (-48.6 points), ii) Power generation and distribution (-43.8 points), and iii) Commercial banks (-43.5 points).
While positive contributions were led by i) Cement (128.2 points), ii) Fertilizer (63.9 points), and iii) Automobile assemblers (34.0 points).
Foreign offloading during the week arrived at USD 2.5 million compared to a net sell of USD 14.2 million last week. Selling was witnessed in Fertilizer (USD 4.8 million) and Banks (USD 4.1 million).
On the domestic front, major selling was reported by Individuals (USD 11.7 million) and Broker Proprietary (USD 4.7 million). Average Volumes settled at 261 million shares (up by 46.3 percent WoW) while average value traded clocked-in at USD 71 million (up by 88.5 percent WoW).
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FBR issues procedure for safe transportation of ISAF cargo
ISLAMABAD: Federal Board of Revenue (FBR) has issued procedure for movement of International Security Assistant Force (ISAF) cargo under Pakistan Customs Container Security System (PCCSS).
The FBR through a notification dated April 17, 2020 said that the procedure as followed for the transshipment cargo shall be applicable for sealing and de-sealing of ISAF cargo with the following modification:
(i) The containers will be sealed with customs machine readable seal at Karachi by PCCSS after representative of ISAF has inspected, verified and confirmed that the Bill of Lading (B/L) seal/ other seal are intact. Sealing will be done in presence of authorized agent.
(ii) The routes shall be specified by the PCCSS, and any different route or time taken en route will be informed to incharge PCCSS by the ISAF representative.
(iii) The private companies authorized by the FBR to carry ISAF cargo in addition to National Logistic Cell (NLC) will have their transport units registered with PCCSS and the Directorate of Transit Trade, Karachi, or as specifically allowed by Incharge PCCSS on, a case to case basis.
(iv) The unloading from Pakistani Transport Unit and loading on Afghan Transport Unit/authorized units will be done at Peshawar/Quetta dry port. In case unloading is done at the respective terminals of the private carriers, the Incharge PCCSS FP Peshawar/Quetta will coordinate with the FP, carriers and ISAF officials and depute PCCSS staff of these terminals for checking of seals. Officials of ISAF/American Consulate will check their own seals and may affix another seal of their own for their checking at Beghrem Base.
(v) The PCCSS FP Peshawar/Quetta will check the Customs seal as well as other seals and unless a discrepancy is noted, allow the change of transport after noting the number of Second Transport of the Form A. The staff on return to PCCSS Focal Point will enter the verification of the seal in the computer.
(vi) The PCCSS seals will be removed at Focal Point Exit Torkham/Chaman, scanned by the bar code reader and stored in the disposal receptacle.
(vii) Returning containers from Afghanistan will be sealed at Torkham/Chaman only if not empty, as per procedure adopted for ISAF at Karachi for container bound for Afghanistan. Empty containers will not be sealed.
Goods not to be sealed: All containerized cargo which is transshipped, in transit or for export is to be sealed. However, in case of large machinery and awkward loads wherein the seals cannot be applied, the decision will be taken by Incharge Focal Point based on the level of risk in transshipment of such cargo. The Incharge Focal Points will also decided if photographs are to be taken and sent to Incharge PCCSS. In such case the Form A will not carry a seal number, but will mention reasons for not sealing the cargo and whether a photograph of the load/cargo has been sent by e-mail.
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SBP advises banks to register security interest under STA
KARACHI: State Bank of Pakistan (SBP) on Friday advised banks, microfinance banks and development financial institutions (DFIs) to register their security interest under secured transaction laws.
The SBP in a circular said that with a view to provide for registration of charge on security/collateral offered by un-incorporated entities including sole proprietorships and partnerships and thereby enhancing their access to finance, The Financial Institutions (Secured Transactions) Act, 2016 (STA) was promulgated on July 1, 2016.
The government has authorized the Securities and Exchange Commission of Pakistan (SECP) to operate Secured Transactions Registry (STR) to record statements in relation to security interests created by entities under STA. SECP is going to launch the Secured Transactions Registry (STR) under the STA on April 27, 2020 for registration of security interests on movable assets of entities, other than companies.
In view of the above, all the banks, microfinance banks and DFIs are advised to register their security interests against movable assets of entities for future as well as prior security interests (i.e. security interests created before the operationalization of the STR as provided under section 73 of the STA) in the STR.
The security interest has been defined as: “a right, title, encumbrance or interest of any kind upon movable property created or provided for by a security agreement in relation to a transaction that in substance secures the payment or performance of a customer’s obligation under a finance without regard to the form of the transaction or the terminology used by the parties or the identity of the person who title to the movable property, and includes any charge, mortgage, hypothecation, fixed charge, floating charge, assignment, lien, pledge, assignment of receivable by way of security and transactions under which a secured creditor retains title such as a finance lease, hire purchase agreement, sale and lease back arrangement, conditional sale agreement and retention of title arrangement, having similar effect.”