Pkrevenue.com

Day: December 25, 2020

  • Non-filers may face concealment of income charges

    Non-filers may face concealment of income charges

    ISLAMABAD: Federal Board of Revenue (FBR) may invoke provisions of Tenth Schedule of Income Tax Ordinance, 2001 under which non-filers of income tax returns for tax year 2020 may face charges of concealment of income.

    Rule 3 of the Tenth Schedule of Income Tax Ordinance, 2001, explained:

    (1) Where for a tax year person’s tax has been collected or deducted in accordance with rule 1 and the person fails to file return of income for that tax year within the due date provided in section 118 or as extended by the Board, the Commissioner shall notwithstanding anything contained in sub-sections (3) and (4) of section 114, within sixty days of the due date provided in section 118 or as extended by the Federal Board of Revenue (FBR) make a provisional assessment of the taxable income of the person and issue a provisional assessment order specifying the taxable income assessed and tax due thereon.

    (2) In making the provisional assessment under sub-rule (1), the Commissioner shall impute taxable income on the amount of tax deducted or collected under rule 1 by treating the imputed income as concealed income for the purposes of clause (d) of sub-section (1) of section 111:

    Provided that the provision of section 111 shall be applicable on unexplained income, asset or expenditure in excess of imputed income treated as concealed income under this rule.

    Explanation.- For the removal of doubt it is clarified that the imputable income so calculated or concealed income so determined shall not absolve the person so assessed, from requirement of filing of wealth statement under sub-section (1) of section 116, the nature and source of amounts subject to deduction or collection of tax under section 111, section of audit under section 177 or 214C or subsequent amendment of assessment as provided in rule 8 and all the provisions of the Ordinance shall apply.

    The last date for filing income tax return for tax year 2020 was expired on December 08, 2020 and a large number of taxpayers have failed to comply with the mandatory requirement of filing annual return.

    At present the applicable ATL is of tax year 2019 and will remain applicable till February 28, 2021. The ATL for tax year 2020 will be issued on March 01, 2021 and will applicable till February 28, 2022.

    The FBR has received record 3 million returns for tax year 2019 and making all efforts to further increase the number for the tax year 2020.

    According to rule 01 of the Tenth Schedule the tax rate of withholding is 100 percent higher for persons having taxable income but not on the ATL.

  • Proposed new tax on car purchase resented

    Proposed new tax on car purchase resented

    KARACHI: An association of industries and traders has resented proposed plan of the government to impose a new tax on purchase of motor vehicles.

    Pakistan Industrial and Traders Association Front (PIAF) has voiced its serious concern over the imposition of new tax on the sale of new cars to control ‘On Money’ practice, saying the move will further enhance the prices of already world most expansive Pakistani four wheelers, said a statement.

    PIAF chairman Mian Nauman Kabir said that the government has decided to impose up to Rs200,000 additional withholding tax on the purchase of new cars on the plea of discouraging ‘On Money’ but actually the move has been aimed at achieving FBR’s target of tax collection.

    He said that the locally-assembled cars are very expansive mainly due to exorbitant government taxes and high profit margins of the assemblers despite the fact that their quality is very low.

    The additional withholding tax of up to Rs200,000 will put more burden on the consumers, who are already buying the very costly vehicles as compared to rest of world.

    He said that the consumers were upset due to unnecessarily long delivery time for vehicles by the manufacturers. In order to discourage the practice of “on money” the government, instead of taking some solid measures, has imposed additional Withholding Income Tax, which does not seem to be logical.

    He said that government can control prices by checking various costs and then ensuring 20 or 30 percent profit of the company.

    “Right now car manufacturers have 1-year advances, which is more than their total investment,” he said.

    “Secondly, the government can definitely intervene to ensure quality, as a car carries a human being and human life is dependent on its quality. The companies in India, Canada or USA have different features and different safety modes and features. Same models in Pakistan have almost zero safety features whereas price in Pakistan is much higher. Let’s forget price for sometimes but at least give us a safe vehicle with less oil consumption,” he argued.

    He said that nowadays 25 percent of the price is being charged in the name of on money. Even if you pay 100 percent you cannot get a car and have to pay ‘ON’ in lakhs, which is almost 25 percent of the total price that is right under the government nose and in knowledge of the concerned authorities, he added.

    PIAF leader appealed the government to devise some mechanism to regulate the automotive sector in view of the quality as well as the prices in consultation with all stakeholders including the industry as well as the consumers.

    Mian Nauman Kabir said that local manufactures revise their cars prices whenever they desire and that too without getting due approval from any authority, which affect the common people badly.

    The Engineering Development Board (EDB) will have to devise some rules and regulations to benefit the consumers along with securing the interest of the auto assemblers in the upcoming auto policy, he said. PIAF also suggests the Senate Standing Committee on Industries and Production to take the notice of exorbitant and ever-soaring prices of cars in Pakistan along with illegal practice of charging ‘on money’ or premium, he added.

    The Senate Standing Committee on Industries and Production, the Engineering Development Board, FBR, Pakistan Automotive Manufacturers Association and major Consumers Welfare Associations should sit together and finalize some mechanism to bring down the prices of automobiles in line with the rates of international market, by revising profit margins and decreasing taxes and duties in the larger interest of the public.

  • FBR starts processing income tax refunds of tax year 2020

    FBR starts processing income tax refunds of tax year 2020

    ISLAMABAD: Federal Board of Revenue (FBR) has started processing income tax refunds for the tax year 2020 and issued instructions in this regard.

    The FBR issued a notification to all the chief commissioners of tax offices stating that payment of refunds or adjustment of refund have identical financial impact for the exchequer and therefore, both warrant equal focus and application of mind so that no undue and undetermined refund is either paid out or adjusted to/by the taxpayers.

    The FBR said that in this connection, the data of income tax refund applications had been obtained from field formations/PRAL for tax year 2020, and examined.

    “The data transpire that out of the total refund claims of Rs74.313 billion in the tax year 2020, 6,073 applications covering an amount of Rs4.254 billion have been lodged,” the FBR said.

    The FBR told the chief commissioners that current year’s refund liability should be paid out of the current year’s revenue stream and that no due refund should be withheld.

    It would also help us ward off unnecessary complaints against us for delayed processing of refund applications and/or non-payment of refund to the taxpayers.

    Therefore, the tax offices are advised to dispose of all applications lodged under section 170 of the Income Tax Ordinance, 2001 by January 31, 2021.