Day: August 17, 2020

FBR apologizes diplomat over show cause notice

ISLAMABAD: Federal Board of Revenue (FBR) has apologized over sending show cause notice to a foreign diplomat by an adjudication collection.

In a tweet message, FBR spokesman said that it had been noticed that Customs Collectorate (Adjudication) Islamabad had sent a notice to the foreign diplomat.

“Sending a notice to a foreign diplomat is against Vienna Convention which provides immunity to the foreign government officials and representatives of an embassy,” the spokesman said.

On the directives of the FBR the Customs office amending the show cause notice and seizure report.

The spokesman said that in the due course the FBR apologized the foreign diplomat over the act of the collectorate.

August 17, 2020
Sindh Excise collects Rs5.44 billion in July

KARACHI: Sindh Excise and Taxation Department has collected Rs5.44 billion during the first month of current fiscal year 2020/2021, a statement said on Monday.

Provincial Minister for Excise & Taxation and Narcotics Control and Parliamentary Affairs Mukesh Kumar Chawla in the statement said that the department had collected a total of Rs 5.442 billion in the current financial year 2020-2021 during the month of July.

He further said that Rs.878.709 million was collected under motor vehicle tax, Rs.4141.677 million under infrastructure tax and Rs.67.807 million under professional tax.

He said that Rs 2.861 million was collected in cotton fee, Rs 34.827 million in property tax and Rs 0.022 million in entertainment duty.

He said that the overall situation of collection of taxes was better. However, he directed the officers to work harder and improve the tax collection situation.

Provincial Minister Mukesh Kumar Chawla also requested the people, being law abiding citizens, they were supposed to deposit their taxes on time.

August 17, 2020
Engro Powergen approves revised IPPs-government MoU

KARACHI: The Board of Directors (BOD) of Engro Powergen Qadirpur in a meeting held on Monday approved the revised terms of Memorandum of Understanding (MoUs) between Independent Power Producers (IPPs) and the government.

The company in a letter sent to Pakistan Stock Exchange (PSX) informed that the Committee for negotiations with Independent Private Power Producers (“IPPs”), notified by Government of Pakistan (the “Committee”) and the IPPs representing the 2002 Power Policy projects, had several rounds of discussions in which the Committee had requested the IPPs to provide concession to the government which concession shall be passed on in the form of relief to the citizens of Pakistan.

The IPPs have reached an understanding with Committee to alter their existing contractual arrangements in the larger national interest, to the extent of, and strictly with respect to, the matters listed under the MoU signed between the Parties on August 13, 2020.

The terms of the MoU are subject to the approval of National Electric Power Regulatory Authority (NEPRA), Federal Cabinet, IPPs’ Board of Directors, other necessary corporate approvals and execution of the final agreement between the relevant parties.

The Board of Directors of the Company in their meeting dated August 17, 2020 have in-principle approved the terms of the MoU.

The Parties have, inter alia, reached an understanding that;

— Return on Equity including Return on Equity During Construction shall be changed to 17 percent per annum in PKR on NEPRA approved equity at Commercial Operation Date of the Company calculated at USD/PKR exchange rate of PKR 148/USD, with no future USD indexation;

— fuel and O&M shall be taken as one consolidated line item and any future net savings shall be shared 60:40 in favour of the power purchaser and Company respectively, after accounting for any reserves created, or to be created for major overhaul if the reserve for major overhaul remains unutilized, it shall be shared in the ratio of 60:40 between the power purchaser and the IPP, respectively;

— Delayed Payment Rate (DPR) under the Power Purchase Agreement shall be reduced to KIBOR + 2 percent for the first 60 days after the due date, and thereafter at KIBOR + 4.5 percent as per the Power Purchase Agreement. Delayed Payment rate of fuel supplier will also be adjusted accordingly. In order to assess if a company has made any excess profits, the reconciled numbers between the Committee and Company, shall be submitted to NEPRA who shall hear and decide this matter in accordance with the 2002 Power policy, tariff determination and Power Purchase Agreement.

Moreover, the Government of Pakistan shall actively support the creation of competitive power markets.

All projects shall convert their contracts to Take and Pay basis, without exclusivity, when Competitive Trading Arrangement is eventually implemented and becomes fully operational.

The parties have agreed that payment of the receivables of the company are an integral part of the MoU. The Power Purchaser and the government will devise a mechanism for repayment of the outstanding receivables with agreement on payment of receivables within an agreed time period, which will be reflected in the final/definitive agreement to be signed, post shareholder approval.

Any understanding in relation to the definitive agreement will be disclosed as and when an agreement has been reached between the relevant parties, the company said.

August 17, 2020
Stock market sheds 168 points on profit taking

KARACHI: The stock market fell by 168 points on Monday owing to profit taking by the investors during the day.

The benchmark KSE-100 index of Pakistan Stock Exchange (PSX) closed at 40,122 points as against 40,291 points showing a decline of 168 points.

Analysts at Arif Habib Limited said that the market took bantering today due to negative impact of tariff rationalization of IPPs, which transpired over the weekend, as well as selling pressure on Fertilizer and Cement sectors on repayment of GIDC as decided by the Supreme Court on the last trading day.

ENGRO hit lower circuit, however, recovered later. Similarly, index heavy weight HUBC saw heavy selling pressure that brought the index down.

Among Banks, HBL saw rates coming down more than other stocks in the sector, which is primarily attributed to profit booking by Investors.

E&P and O&GMCs performed well, partly due to switching by investors from Power and Fertilizer sectors and partly because of expectation of resolution of circular debt.

Resultantly, SNGP and SSGC hit upper circuits, whereas PSO also traded near upper circuit. O&GMCs topped the volumes with 72.3 million shares, followed by Power (67.5 million) and Vanaspati (57.7 million).

Among scrips, UNITY led the volumes with 37.3 million shares, followed by HASCOL (35.2 million) and TRG (26.4 million).

Sectors contributing to the performance include O&GMCs (+95 points), Pharma (+36 points), E&P (+33 points), Autos (+22 points) and Engineering (+14 points), Fertilizer (-170 points) and Power (-125 points).

Volumes declined from 556.3 million shares to 522.7 million shares (-6 percent DoD). Average traded value, on the contrary, increased by 16 percent to reach US$ 133.7 million as against US$ 115.1 million.

Stocks that contributed significantly to the volumes include UNITY, HASCOL, TRG, PRL and PAEL, which formed 29 percent of total volumes.

Stocks that contributed positively to the index include PSO (+49 points), SNGP (+28 points), ABOT (+18 points), OGDC (+18 points) and PPL (+17 points). Stocks that contributed negatively include HUBC (-121 points), ENGRO (-116 points), HBL (-62 points), EFERT (-62 points) and LUCK (-27 points).

August 17, 2020
FBR chairman to hold e-Katcheri for taxpayers

ISLAMABAD: Javaid Ghani, Chairman, Federal Board of Revenue (FBR) will listen to problems faced by taxpayers through e-Katcheri on Friday August 21, 2020.

The chairman will be available for taxpayers through telephone number # 051-111772772 between 10:00AM to 11:00AM on Friday August 21, 2020..

The program has been launched in compliance with the directive of the prime minister to conduct e-Khuli Katcheri to stay in contact with the public by all available means and provide them accessible platform to raise their issues for timely resolution.

The taxpayers facilitation wing of the FBR recently circulated about the program directing that e-Katcheri would be conducted by every tier of FBR in the second week of every month on regular basis.

The FBR directed all the tax offices to ensure that all proceedings of the e-Katcheri are property recorded and tasks should be assigned to concerned officers accordingly.

The tax offices have also been directed to submit performance report on the outcome of the meeting with public.

In the wake of COVID-19, the tax authorities shall conduct one e-Katcheri at all tiers of FBR in the second week of every month. In the backdrop of COVID-19, only e-Katcheris shall be conducted for the time being until normalcy of the situation.

August 17, 2020
Rupee ends down by 24 paisas against dollar

KARACHI: The Pak Rupee ended down by 24 paisas against dollar on Monday owing to higher demand for import and corporate payments as market opened after long holidays.

The rupee ended Rs168.17 to the dollar as against the closing of August 13, 2020 at Rs167.93 in interbank foreign exchange market.

Currency experts said that the market was opened after three holidays and it resulted in higher demand for import and corporate payments.

The market was remained closed on August 14, 2020 on account of Independence Day and further two days closure due to weekly holidays.

The experts said that the local unit likely to rebound in coming days on back of improved inflows of workers’ remittances and export receipts.

The inflow of workers’ remittances hit monthly record high of $2.77 billion in July 2020.

In July, workers’ remittances rose to US $ 2.768 billion. “This is the highest ever level of remittances in a single month in Pakistan,” according to State Bank of Pakistan (SBP).

In terms of growth, remittances increased by 36.5 percent over July 2019 (y/y) and 12.2 percent over June 2020 (m/m). Given the impact of Covid-19 globally, this increase in worker’s remittances is encouraging.

August 17, 2020
Remittances hit monthly record high: SBP

KARACHI: The inflow of workers’ remittances hit monthly record high of $2.77 billion in July 2020, State Bank of Pakistan (SBP) said on Monday.

In July, workers’ remittances rose to US $ 2.768 billion. “This is the highest ever level of remittances in a single month in Pakistan,” the SBP said.

In terms of growth, remittances increased by 36.5 percent over July 2019 (y/y) and 12.2 percent over June 2020 (m/m). Given the impact of Covid-19 globally, this increase in worker’s remittances is encouraging.

In July, sizeable amounts of workers’ remittances were received from Saudi Arabia (US $ 821.6 million), UAE (US $ 538.2 million), UK (US $ 393.9 million) and USA (US $ 250.6 million).

The growth rate in remittances compared to the same month in the previous year is around twice as high as the Eid-ul-Adha related seasonality typically experienced over the last decade.

Several factors have likely supported the growth in remittances to date, including orderly exchange rate conditions and policy steps taken by the State Bank and the Federal Government under the Pakistan Remittance Initiative. These steps include reducing the threshold for eligible transactions from USD 200 to USD 100 under the Reimbursement of Telegraphic Transfer (TT) Charges Scheme, an increased push towards adoption of digital channels, and targeted marketing campaigns to promote formal channels for sending remittances.

To improve data quality and better capture the source country of the remitter, the compilation methodology for ‘country wise’ workers’ remittances has been strengthened from this month. Therefore, country-by-country trends will be available on a consistent basis from August 2020 onwards.

Importantly, the new data collection method does not affect the reporting of the level of remittances arriving into Pakistan.

Importantly, the revised country shares under the improved data do not necessarily imply that remittances from one country have increased over another. Instead they demonstrate that the source country of remittances is being recorded more accurately now.

August 17, 2020