Pkrevenue.com

Month: October 2020

  • State Bank’s annual profit surges to historic high of Rs1.16 trillion

    State Bank’s annual profit surges to historic high of Rs1.16 trillion

    KARACHI: The State Bank of Pakistan (SBP) has declared profit of Rs1.16 trillion, the highest profit in the history of the bank, for the year ended June 30, 2020.

    The SBP in performance report issued on Thursday said that the stability in the exchange rate allowed SBP to return to profitability after incurring loss in the preceding year. The SBP recorded a loss of Rs846 million for the year ended June 30, 2019.

    “The profit so earned by the SBP in the year ended June 30, 2020 is highest in its history.”

    The high interest rate prevalent in the first three quarters of the year allowed the central bank to accrue significant amount of interest income from the interest sensitive assets, particularly lending to the Government and income from the Bank’s open market operations.

    Further, during the year, the liquidity mopping up operations were relatively on reduced scale and hence the interest expense registered a substantial decline.

    The total assets stood at Rs.12,273 billion as at June 30, 2020 as compared to Rs.11,467 billion on June 30, 2019, registering an increase of Rs.806 billion primarily due to increase in foreign currency accounts and investments.

    Similarly, the total liabilities of the bank stood at Rs.11,219 billion as at June 30, 2020 as compared to Rs.10,761 billion as at June 30, 2019, registering an increase of Rs.458 billion. This rise was primarily led by increase in currency in circulation.

    SBP introduced certain interest free/subsidized refinancing schemes during COVID-19 pandemic. As per the requirements of IFRS-9, the subsidized loans are required to be recorded at fair value.

    Accordingly, an amount of Rs.4,194 million has been recognized as fair valuation adjustment against these loans. This fair valuation adjustment will be amortized and recorded as income over the period of loans.

  • Stock market plunges by 1299 points on increase in corona case

    Stock market plunges by 1299 points on increase in corona case

    Karachi: The stock market has plunged by 1299 points on Thursday that can be attributed to surge in corona virus cases in the country.

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  • Mobilink terms FBR recovery action as unfortunate

    Mobilink terms FBR recovery action as unfortunate

    ISLAMABAD: A spokesman of Jazz (Mobilink) on Thursday said that the treatment of the Federal Board of Revenue (FBR) for the recovery of disputed amount through sealing the office was unfortunate.

    “Despite being the largest taxpayers, we are treated in an unfortunate way,” a company spokesman said.

    “While the government is making efforts to improve the business environment in the country, such drastic measures would unfortunately severely affect investment prospects,” the spokesman said in a statement.

    “We have received a notice from FBR yesterday for the recovery of a disputed tax demand and we have serious reservations on these alleged taxes.

    “The proceedings were carried out on plea of a tax recovery notice for a disputed amount from 2018 which is under legal proceedings.

    “Due to the drastic measures our corporate reputation and pride has been hurt and shakes the confidence of foreign investors of Jazz and others.

    “Despite being the largest taxpayers, we are treated in an unfortunate way.

    “While the government is making efforts to improve the business environment in the country, such drastic measures would unfortunately severely affect investment prospects,” the spokesman said.

    Jazz seeks resolution of the matter and has always been willing to conduct dialogue as well as rightful legal course to reach merit and right interpretation.

    “Jazz also assures its valued customers that despite the challenges, we will continue to provide uninterrupted services,” the statement said.

    Mobilink is Pakistan’s number one 4G operator and the largest internet and broadband service provider is amongst the largest taxpayers and the biggest foreign investors with an investment of over US$ 9.5 billion during the last 25 years.

    In the last 6 years alone, Jazz has contributed over Rs251 billion to the national exchequer in the form of taxes and duties.

    Jazz has always been a law-abiding corporate citizen and has been in the forefront for contributing to Pakistan’s economy in monetary and development terms, and as the market leader in telecom and internet services with over 63 million customers.

    The company has also discharged its social responsibility in floods, earthquakes, and recently in COVID-19 relief response worth over Rs1.2 billion.

  • OICCI expresses dismay over FBR action against mobile operator

    OICCI expresses dismay over FBR action against mobile operator

    KARACHI: Overseas Investors Chamber of Commerce and Industry (OICCI) on Thursday expressed its shock and dismay over action taken by the tax authorities against Pakistan’s leading mobile operator.

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  • Dollar falls to Rs160.26 as Pak Rupee gains 36 paisas

    Dollar falls to Rs160.26 as Pak Rupee gains 36 paisas

    KARACHI: The Pak Rupee gained another 36 paisas against the dollar on Thursday owing to inflows of workers’ remittances and export receipts offset the demand for import payment.

    The rupee ended Rs160.26 to the dollar from the previous day’s closing of Rs160.62 in the interbank foreign exchange market.

    Currency experts said that due to positive economic indicators and current account surplus the rupee made gain. They said that during the day the market witnessed demand for dollars but the inflows helped the rupee to further appreciate against the greenback.

    The inflow of workers’ remittances has registered a sharp increase of 31.2 percent after making the fourth consecutive month of over $2 billion received in September 2020.

    The State Bank of Pakistan (SBP) said that the remittances increased to $2.3 billion, 31.2 percent higher than the same month last year and 9 percent higher than in August 2020.

    Workers’ remittances remained above $2 billion for the fourth consecutive month in September, the central bank said.

    On a cumulative basis, remittances rose to a record $ 7.1 billion in the first quarter of current fiscal year, 31.1 higher than the same period last year.

    The level of remittances in September was slightly higher than SBP’s projections of $2 billion.

  • FBR delegates powers of appointing authority

    FBR delegates powers of appointing authority

    ISLAMABAD: Federal Board of Revenue (FBR) on Thursday notified authorities for appointment of officials in the revenue board.

    According to the notification Secretary, the Revenue Division shall have power to appoint officials in the posts in basic pay scales 17 to 19 or equivalent.

    Member Admin has been authorized to appoint posts in basic pay scales 16 or equivalent in FBR Headquarter and its field offices.

    Chief (Management) has been authorized to appoint officials in basic pay scales 8 to 15 or equivalent in FBR HQ.

    Chief Admin has been authorized to appoint officials in post of basic pay scales 1 to 7 or equivalent in FBR HQ.

    For appointing in posts in BS-1 to 15 of field offices of the FBR, the appointing authorities are chief commissioner in BS-20/21, Director General (BS-21), Chief Collectors (BS-21), Collectors (BS-20).

  • FBR launches crackdown against sugar mills for benami transactions

    FBR launches crackdown against sugar mills for benami transactions

    ISLAMABAD: Federal Board of Revenue (FBR) has launched investigation against sugar mills after detection of large scale benami transactions.

    A statement issued on Thursday, the FBR said that Benami Zone II, Lahore has taken up the investigation of 5 sugar mills for the verification of benami transactions.

    Purchasers with the largest quantities as declared by the mills in their sales tax returns, were randomly summoned to ascertain their authenticity as buyers of sugar.

    The exercise unraveled the occurrence of benami transactions at a large scale during the preliminary investigation.

    Keeping in view the HR constraints, logistical limitations and narrow timelines involved in the proceedings, detailed scrutiny was initiated in two sugar mills initially i.e. Alliance Sugar Mills and Hunza Sugar Mills. As far as rest of the sugar mills are concerned, information will be gathered including information from the banks and proceedings will be started after concluding the already initiated cases.

    Show cause notices u/s 22 of Benami Transaction (Prohibition) Act 2017 have been served upon M/s Hunza Sugar Mills and M/s Alliance sugar mill whereby the mills with the actual buyers of sugar and sugar mills brokers have been alleged to have conducted benami transactions.

    Perusal of the sales tax returns of Alliance Sugar Mills and Hunza Sugar Mills showed that sugar worth PKR 19,125,774,948 and PKR 5,164,464,58 respectively, for TY 2017-2020, had been sold by mills to unregistered persons.

    To check the authenticity of these buyers, Benami Zone II, Lahore issued summons to multiple purchasers who in their written statements denied knowledge of any such transaction.

    During the course of investigation, it was extracted that the unregistered purchasers being shown in sales tax returns of the aforementioned sugar mills were ostensible owners including low paid workers or truck drivers, rather than the real owners, which to date remain unaware of their involvement in sugar purchase.

    The provisions of the law stipulate that subject to the issuance of notice to show cause u/s 22, the Initiating Officer has to attach the benami property within 90 days incase the Initiating Officer intends to file the reference in the case.

    The law additionally provides 60 days to the IO for the drafting of the case statement to further forward it to the Adjudicating Authority. In case the IO finds no aspect of benami transaction during the course of investigation within 90 days of issuance of show cause notice, he is bound by law to drop the proceedings.

    With the filing of reference, the Adjudicating Authority is under obligation to issue notice to the beneficial owner, benamidar and any interested party within 30 days of receipt of reference requiring them to file their reply.

    In case benamidar/beneficial owner is involved in the commission of benami transaction, the Adjudicating Authority would pass order holding the property referred in reference as benami property and passing order to that effect.

    The law binds Adjudicating Authority to decide reference within one year from the date of filing of reference. The Adjudicating Authority, after holding the property benami, initiates proceedings for confiscation of benami property.

    Besides confiscation of benami property, the law provides prosecution of benamidar, beneficial owner and abettor etc. Subsequent to the trial, the law provides that the person involved in benami transactions would be sentenced to imprisonment extending from one year to seven years and additional payment of 25 percent of fair market value of the property involved.

  • Chain stores sign MoU to integrate with FBR’s online system

    Chain stores sign MoU to integrate with FBR’s online system

    ISLAMABAD: Big retailers with chain stores have agreed to install Point of Sale (POS) at their outlets to integrate sales and purchase with online system of Federal Board of Revenue (FBR).

    In this regard a Memorandum of Understanding (MoU) was signed between the FBR and Chain Stores Association of Pakistan (CAP) to ensure effective and efficient integration of (POS) installed at Tier 1 retailers’ location all across the country.

    This huge milestone achieved on Wednesday provides for incentives to the retailers who voluntarily integrate with FBR’s system by November 30, 2020.

    To facilitate smooth integration and collectively manage any bottlenecks, CAP committees will be formed at central and regional levels.

    The chain store retailers assured FBR that all Tier 1 integrated retailers would fully integrate all their tills/PoS without any exception by November 30, 2020.

    They also assured that all of their branches would be fully integrated by then. The association will also augment FBR’s efforts to improve the PoS system and make it foolproof.

    CAP will also assist FBR in the identification of all Tier 1 and Tier 2 Retailers who are liable to be integrated and have not yet integrated.

    The foundational principle of this MoU and the benefits agreed to by FBR is complete integration by Tier 1 Retailers with FBR’s system by November 30, 2020.

  • FBR takes notice of officials’ reluctance in joining new place of posting

    FBR takes notice of officials’ reluctance in joining new place of posting

    ISLAMABAD: Federal Board of Revenue (FBR) has decided to take departmental action against officials who are reluctant in joining new place of posting.

    In a circular issued on Wednesday, the FBR has taken notice that officials are not adhered to instructions laid down in transfer and posting orders.

    “The transfer and posting orders are issued with immediate effect but it has been observed that officers and officials do not relinquish the charge as per orders/notifications and board has to relieve them from their previous postings to join new place of postings,” the FBR said.

    Furthermore, as mentioned in each order/notification, that officers are required to relinquish and assume charge using online HRMS facility made available at all FBR major field offices or by using IJP login available to them. “However, despite clear directions on the same manual charge relinquishment and assumption reports are forwarded to the FBR as a practice which creates lot of administrative issues for FBR.

    Taking serious view of the non adherence of the administrative instructions, following instructions are being issued in this regard to be followed in letter and spirit in future:

    i. Officers will relinquish the charge within three days of transfer and posting orders, and will assume charge of new place of posting as per rules. In case of failure, action will be initiated for non-adherence to the Board’s instructions.

    ii. No manual charge relinquishment/assumption report will be entertained in board in future, and the officers are directed to do the same through using online HRMS facility made available at all FBR major field offices or by using IJP login. However if any difficulty arises in this regard, officers are directed to contact MIS officers posted at respective filed formations or Secretary (Automation/SSM).

    iii. The concerned ADC/DC HQ shall be personally responsible and ensure that all officers posted in and out of the field offices have assumed/relinquished charge as per instruction.

    iv. Chief Commissioners-IR and Director Generals-IR shall be responsible for the compliance of the board’s instruction in letter and spirit.

  • FBR initiates Rs25 billion tax recovery from Mobilink

    FBR initiates Rs25 billion tax recovery from Mobilink

    ISLAMABAD: Federal Board of Revenue (FBR) on Wednesday initiated tax recovery of Rs25 billion from M/s. Pakistan Mobile Communication Limited (PMCL), including sealing of business premises.

    PMCL is a mobile operator in Pakistan operating with trade name of Mobilink.

    Large Taxpayers Office (LTO) Islamabad, one of the major revenue collecting units of the FBR, took the action against the mobile operator as income tax amount Rs25.39 billion was outstanding against the defaulter. “The defaulter is refraining itself deliberately, dishonestly and without lawful excuse to discharge tax liability and thus causing huge loss to the national exchequer,” according to a notice of LTO Islamabad.

    The tax office had given deadline till 1300 hours on October 28, 2020 to pay the outstanding amount.

    The tax office had initiated the recovery proceedings for the said amount by one or more of the following modes, namely:

    — Attachment and sale of moveable or immovable property;

    — Appointment of receiver for the management of your moveable or immovable property;

    — Arrest and detention in person for a period not exceeding six months.

    — As specified under clasue (a), (ca) and (d) of sub-section (I) of section 48 of the Sales Tax Act, 1990.

    The FBR notice said that an amount of Rs22.03 billion was outstanding against the mobile operator related to tax year 2018. Further an amount of default surcharge of Rs3.36 billion to total outstanding amount.

    While responding to the report, the PMCL issued the following statement:

    “Jazz is a law-abiding and responsible corporate citizen. Our contribution to Pakistan’s economy over the past 25 years is significant.

    “We have received a notice from FBR this afternoon. Jazz has made tax submissions based on legal interpretations of the tax owed. We will review and take measures under our legal obligations and will collaborate with all concerned institutions for an early resolution of this issue.”