Pkrevenue.com

Day: June 22, 2020

  • SRB suspends sales tax registration of Turnotech for defaulting tax payment

    SRB suspends sales tax registration of Turnotech for defaulting tax payment

    KARACHI: Sindh Revenue Board (SRB) has suspended sales tax registration of M/s. Turnotech (Pvt) Limited defaulting tax payment and non-compliance of filing monthly returns.

    In a notice the SRB said that M/s. Turnotech (Pvt) Limited had failed to comply with the following obligations:

    — To discharge the Sindh sales tax liability against the services provided or rendered during the tax periods from March 2015 to July 2015, September 2015 to December 2015 and April 2016 to July 2018.

    — e-file their Sindh sales tax return for the tax periods from March 2015 to July 2015, September 2015 to December 2015 and April 2016 to July 2017.

    The SRB said that the suspension of the company would be revoked on taking following measures:

    — to discharge the due Sindh Sales Tax liability along with default surcharge for the tax periods from March 2015 to July 2015, September 2015 to December 2015 and April 2016 to July 2017.

    — to e-file the true and correct monthly Sindh sales tax returns for the tax periods from March 2015 to July 2015, September 2015 to December 2015 and April 2016 to July 2017, accordingly.

    The SRB said that the compliance date for remedial actions had been fixed on June 23, 2020. In case of non-satisfactory response or failure to take remedial measures the case would be proceeded for cancellation from the provincial tax authority.

  • Inland Revenue offices to observe extended working hours on June 29 – 30

    Inland Revenue offices to observe extended working hours on June 29 – 30

    ISLAMABAD: The offices of Inland Revenue have been directed to observe extended working hours on last two days of current fiscal year in order to facilitate taxpayers in payment of duty and taxes.

    In an office order issued on Monday, the Federal Board of Revenue (FBR) said that all Large Taxpayers Units (LTUs), Corporate Regional Tax Offices (CRTOs) and RTOs would remain open and observe extended working hours till 9:00 PM on Monday June 29, 2020 and till 11:00PM on Tuesday June 30, 2020 to facilitate taxpayers in payment of duty and taxes.

    The FBR directed chief commissioners to establish liaison with State Bank of Pakistan (SBP) and authorized branches of National Bank of Pakistan (NBP) to ensure transfer of tax collection by these branches on June 30, 2020 as per SBP’s letter dated June 18, 2020.

  • FBR exempts duty, taxes on import of Remdesivir

    FBR exempts duty, taxes on import of Remdesivir

    ISLAMABAD: Federal Board of Revenue (FBR) on Monday exempt duty and taxes on import of antiviral drugs for prevention of coronavirus.

    The FBR issued SRO 557(I)/2020 to exempt income tax on import of finished drug Remdesivir 100mg injection and injectable solution 100 mg vital.

    A new section 12D has been inserted to Section 148 of Income Tax Ordinance, 2001 to provide relief on import of the drug.

    Similarly, another SRO 558(I)/2020 has been issued by the FBR to exempt the import of finished drug Remdesivir 100 mg injection and injectable solution 100mg vial (PCT3004.9099) from whole of the customs duty and additional customs duty.

  • Stock market gains 299 points after intra-day losses

    Stock market gains 299 points after intra-day losses

    KARACHI: The stock market increased by 299 points on Monday after making recovery of intra-day losses.

    The benchmark KSE-100 index of Pakistan Stock Exchange (PSX) closed at 33,738 points as against 33,438 points showing an increase of 299 points.

    Analysts at Arif Habib Limited said that the market went down in the early part of the session, declining by 368 points but rebounded later to erase all losses.

    The intra-day movement amounted to 723 points. Fertilizer sector contributed to the positivity, mainly on the back of EFERT and FFC, which was further aided by a rebound in E&P stocks (OGDC and PPL).

    Among Banks, BAFL and MCB, which were positive on the last trading day due to FTSE rebalancing, sustained price losses but otherwise the banking sector stocks some brisk buying activity, especially FABL, which hit upper circuit.

    Technology sector realized trading volume of 19.6 million shares, followed by Cement (18.1 million) and Banks (12.8 million). Among scrips, UNITY topped the volumes with 11.5 million shares, followed by MLCF (8.2 million) and TRG (7.3 million).

    Sectors contributing to the performance include Fertilizer (+120 points), E&P (+64 points), Power (+33 points), Banks (+25 points) and Autos (+23 points).

    Volumes increased from 105.9 million shares to 161 million shares (+51 percent DoD). Average traded value also increased by 83 percent to reach US$ 36.8 million as against US$ 20 million.

    Stocks that contributed significantly to the volumes include UNITY, MLCF, TRG, HASCOL and HUMNL, which formed 25 percent of total volumes.

    Stocks that contributed positively to the index include FFC (+49 points), ENGRO (+48 points), OGDC (+30 points), HUBC (+26 points) and EFERT (+21 points). Stocks that contributed negatively include AGP (-14 points), MCB (-12 points), ABOT (-5 points), SHFA (-5 points), and NESTLE (-5 points).

  • Senate committee rejects taxpayers profiling, real-time access to information

    Senate committee rejects taxpayers profiling, real-time access to information

    ISLAMABAD: The Standing Committee on Finance, Revenue and Economic Affairs, in a meeting, has rejected new clauses of taxpayers profiling and real-time access to information.

    The committee strongly rejected the amendments to the taxpayers profile, appeal to appellate tribunal, offences and penalties and power to enter and search premises.

    Clauses related to real time access to Information and databases have been disapproved as well, said a statement.

    The standing committee meeting was held last week took up the Finance Bill 2020, containing the Annual Budget statement presented in the House on 12 June, 2020. Review of the Income Tax Ordinance, 2001 and Federal, Excise Provisions of Finance Bill, 2020 was completed.

    Amendments recommended by the Committee in the Public Finance Management Act 2019 were carried out and shared with the Committee.

    Chaired by Senator Farooq Hamid Naek, the meeting was attended by Senator Mohsin Aziz, Senator Zeeshan Khanzada, Senator Musadik Masood Malik, Senator Mian Muhammad Ateeq Sheikh, Senator Senator Talha Mehmood, Senator Ayesha Raza Farooq, and senior officers from the Ministry for Finance, Revenue and Economic Affairs, Ministry of Commerce and Federal Board Revenue.

    The Committee deliberated over Restriction on deduction of profit on debt payable to associated enterprises. Agreements for the avoidance of double taxation and prevention of fiscal evasion were discussed as well.

    Special concessions have been awarded to items that are essential during COVID 19 Pandemic.

    The Committee appreciated the measures taken by the FBR to deal with vast consequences of the Pandemic.  Omission of collection of advance tax from dealers, commission agents and arhatis etc., by market committees was welcomed.

    This is an important measure to promote agriculture in the country.

    Advance tax on education related expenses has been omitted as well.

    In an attempt to discourage the use of caffeinated drinks FED has been increased from 13 percent to 25 percent.

    Imported cigarettes, cheroots, cigarillos, cigars of tobacco and tobacco substitutes have been subjected to FED at 100 percent.

  • Rupee gains five paisas against dollar

    Rupee gains five paisas against dollar

    KARACHI: The rupee gained by five paisas against dollar on Monday after some improvement in foreign exchange reserves was seen in the latest data.

    The rupee ended Rs166.59 to the dollar from last Friday’s closing of Rs166.64 in interbank foreign exchange market.

    The foreign exchange reserves of the country have increased by $70 million to $16.775 billion by week ended June 12, 2020.

    The foreign exchange reserves were at $16.705 billion by week ended on June 05, 2020.

    The foreign exchange reserves held by the central bank increased by $11 million to $10.107 billion by week ended June 12, 2020 as compared with $10.096 billion a week ago.

    Currency experts said that the local currency was under pressure during the last week owing to repayment of external debt.

  • CGT on shares disposal to be collected on June 29

    CGT on shares disposal to be collected on June 29

    KARACHI: National Clearing Company Pakistan Limited (NCCPL) on Monday said that Gain Tax (CGT) for the month of May 2020 will be collected on June 29, 2020.

    In a statement the NCCPL said that the aggregate amount of CGT arising on disposal of shares at Pakistan Stock Exchange for the period May 01, 2020 to May 31, 2020, would be collected on Monday June 29, 2020 through respective settling banks of the clearing members.

    All Clearing Members are hereby requested to ensure requisite amount in their respective settling bank’s account. Necessary details and reports for the said period have already been made available in the CGT System.

    Further, the aggregate amount of CGT arising on trading of future commodity contracts at Pakistan Mercantile Exchange for the period May 01, 2020 to May 31, 2020, would also be collected from the Pakistan Mercantile Exchange on Monday June 29, 2020.

    Necessary details and reports for the said period have already been made available.

    Moreover, the aggregate amount of CGT arising on redemption of units of open end mutual funds have also been finalized for the period May 01, 2020 to May 31, 2020. Necessary details and reports have already been made available in the CGT System.

    The NCCPL asked the clearing members and Pakistan Mercantile Exchange to verify the investor wise details of capital gain or loss and tax thereon, if any, through reports/downloads.

    It further said that in case of none or partial collection of CGT, necessary action would be taken in accordance with the Rules and NCCPL Regulations.

  • Tax slabs for salaried person for tax year 2020/2021

    Tax slabs for salaried person for tax year 2020/2021

    KARACHI: Following are the tax slabs for salaried persons to be applicable during tax year 2021 (2020/2021).

    1. Where taxable income does not exceed Rs. 600,000: the tax rate shall be zero percent

    2. Where taxable income exceeds Rs. 600,000 but does not exceed Rs. 1,200,000: the tax rate shall be 5 percent of the amount exceeding Rs. 600,000

    3. Where taxable income exceeds Rs. 1,200,000 but does not exceed Rs. 1,800,000: the tax rate shall be Rs. 30,000 plus 10 percent of the amount exceeding Rs. 1,200,000

    4. Where taxable income exceeds Rs. 1,800,000 but does not exceed Rs. 2,500,000: the tax rate shall be Rs. 90,000 plus 15 percent of the amount exceeding Rs. 1,800,000

    5. Where taxable income exceeds Rs.2,500,000 but does not exceed Rs. 3,500,000: the tax rate shall be Rs. 195,000 plus 17.5 percent of the amount exceeding Rs. 2,500,000

    6. Where taxable income exceeds Rs. 3,500,000 but does not exceed Rs. 5,000,000: the tax rate shall be Rs. 370,000 plus 20 percent of the amount exceeding Rs. 3,500,000

    7. Where taxable income exceeds Rs. 5,000,000 but does not exceeds Rs. 8,000,000: the tax rate shall be Rs. 670,000 plus 22.5 percent of the amount exceeding Rs. 5,000,000

    8. Where taxable income exceeds Rs. 8,000,000 but does not exceeds Rs. 12,000,000: the tax rate shall be Rs. 1,345,000 plus 25 percent of the amount exceeding Rs. 8,000,000

    9. Where taxable income exceeds Rs. 12,000,000 but does not exceeds Rs. 30,000,000: the tax rate shall be Rs. 2,345,000 plus 27.5 percent of the amount exceeding Rs. 12,000,000

    10. Where taxable income exceeds Rs. 30,000,000 but does not exceeds Rs. 50,000,000: the tax rate shall be Rs. 7,295,000 plus 30 percent of the amount exceeding Rs. 30,000,000

    11. Where taxable income exceeds Rs. 50,000,000 but does not exceeds Rs. 75,000,000: the tax rate shall be Rs. 13,295,000 plus 32.5 percent of the amount exceeding Rs. 50,000,000

    12. Where taxable income exceeds Rs. 75,000,000: the tax rate shall be Rs. 21,420,000 plus 35 percent of the amount exceeding Rs. 75,000,000

  • Amendments to taxability on payments for goods, services and contracts

    Amendments to taxability on payments for goods, services and contracts

    KARACHI: The Finance Bill 2020 has proposed changes to taxability on payments made for goods, services and contracts.

    According to explanation to amendments made to Section 153 of Income Tax Ordinance, 2001 through Finance Bill 2020 by BDO Pakistan Audit Consultancy and Tax Advisory Firm:

    (1a): The bill seeks to include toll manufacturing to be treated as sale of good for the purpose of withholding under this subsection. This inclusion clarifies the taxability of this segment and it will be minimum tax.

    (3): The bill seeks to treat taxes withheld at source as minimum tax on payment of goods, services and execution of contracts.

    (4): The tax deducted at source is adjustable for the Company being manufacturer and the Public Listed Company registered on stock exchange. This inclusion will result in expansion of tax collection by the board.

    The Bill seeks that the Commissioner shall respond to application for the issuance of exemption certificate related to withholding of taxes against goods, services and execution of contracts to facilitate the public listed companies registered in stock exchange, within fifteen days.

    Where not responded, the IRIS may issue exemption certificate provided that the advance tax under section 147 was paid by the taxpayer.

    The Commissioner retains the power to revoke the automatically issued certificate by IRIS on the basis of reasons to be recorded in writing after providing an opportunity of being heard.

    (7) The Bill has sought following amendments in the requirement of the prescribed person defined as withholding agent.

    Existing Description:

    Individuals and association of person having turnover of fifty million rupees

    Proposed Description:

    Individuals and association of person having turnover of one hundred million rupees. Persons registered under Sales Tax Act, 1990 only are now required to meet turnover of one hundred million rupees or more in any preceding tax years to qualify as withholding agent.

  • Finance Bill proposes significance amendments to income tax at import stage

    Finance Bill proposes significance amendments to income tax at import stage

    KARACHI: The Finance Bill 2020 has proposed significant amendments related to income tax at import stage in Section 148 of Income Tax Ordinance, 2001 as it was described by BDO Pakistan Audit Consultancy and Tax Advisory Firm.

    Following are the changes proposed by the Finance Bill, 2020 in Section 148:

    148(1): The bill seeks to add expression “in respect of goods classified in Parts I to III of the Twelfth Schedule” in sub-section (1) of the Section 148. The tax advisory firm interprets that earlier rates of advance tax at import stage were classified in the First Schedule now a separate Twelfth Schedule is constituted which specifies goods wise rates.

    148(1): The bill seeks to add a new proviso to initiate that the Board [Federal Board of Revenue] may, through a notification in the official Gazette, add a good in any Part or reclassify a good from one Part to another of the Twelfth Schedule. The firm commented that Board [FBR] reserves powers to enter any good in the Twelfth Schedule.

    148(7): The Finance Bill seeks to insert the expression “goods on which tax is required to be collected under this section at the rate of 1 percent or 2 percent by an industrial undertaking for its own use” to make tax adjustable. The firm commented that tax at the rate of 1 percent or 2 percent paid by an industrial undertaking for import of goods for its own use shall become adjustable tax.

    148(7): The bill seeks to omit the hyphen and clauses “(a), (c), (d). The tax advisory firm commented that the omission results in withdrawal of exemption from advance tax at import stage provided to motor vehicles in CBU condition by manufacturer of motor vehicles and large import houses.

    148(8) & 148(8A): The bill seeks to omit sub-section (8) and (8A) of section 148. The firm commented that this will result in end of minimum tax regime for edible oil, packing material and plastic raw material and ships breakers and now tax paid at import stage can be claimed as adjustable tax if industrial undertaking criteria are fulfilled.

    148(9): The bill seeks to amend the term “value of goods” by linking it with retail price under the Third Schedule of the Sales Tax Act, 1990, and other than Third Schedule items. The firm commented that for the purpose of collection of advance income tax at import stage, value of goods has been aligned with the enabling provision of the Sales Tax Act 1990, which specifies the value for the purpose of sale tax at import stage.

    148A: Tax on local purchase of cooking oil or vegetable ghee by certain persons. The firm commented that earlier this section resulted in manufacture of vegetable ghee or cooking oil to pay 2 percent final tax on local purchase of locally produced edible oil. The Bill seeks to omit this section, which would result such manufacturer and taxing real net income of the taxpayers.