ISLAMABAD: The Federal Board of Revenue (FBR) has received 2.3 million income tax returns for the tax year 2020 by December 31, 2020, according to an official statement released on Friday.
(more…)Month: January 2021
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FBR needs 45.5 percent collection growth in second half to achieve annual target
ISLAMABAD: Federal Board of Revenue (FBR) needs to collect tax at a difficult growth rate of 45.5 percent in remaining half (January – June) of fiscal year 2020/2021 to achieve full year revenue collection target of Rs4,963 billion.
According to provision figures released by the FBR on Friday the net collection for the first half (July – December) of fiscal year was at Rs2,204 billion as compared with Rs2,101 billion in the same period of the last fiscal year, showing a growth of five percent.
The FBR also missed the revenue collection target for the first half by slight margin. The collection target for the first half of the current fiscal year was Rs2,210 billion.
Tax authorities hoped that the momentum of revenue collection would increase as major chunk of revenue was lost last year during the second half due to coronavirus pandemic.
According to a FBR report an amount of around Rs500 billion as revenue could not be realized due to halt in economic activities after coronavirus lockdown during March – June 2019/2020.
The FBR needs another Rs2,759 billion during the next half of the current fiscal year to achieve the target. It shows that average monthly collection should be around Rs460 billion during January – June 2020/2021.
The tax collection was at Rs2,101 billion during last six months of the preceding fiscal year.
Therefore, in case the FBR could able to realize Rs500 billion revenue losses incurred due to the pandemic in the last fiscal year the final tally would be in favor of the tax authorities.
The FBR has been assigned Rs4,963 billion revenue collection target for fiscal year which was 24.16 percent higher when compared with total collection of Rs3,997 billion in the last fiscal year.
Tax experts, however, doubt about the collection numbers by end of current fiscal year. They said that the coronavirus was not over and second phase of the pandemic had already denting economies of many countries.
The breakup of head-wise collection revealed the direct tax collection posted 4 percent growth to Rs816 billion during first half of the current fiscal year as compared with Rs785 billion in the same half of the last fiscal year.
The collection of sales tax registered 6.7 percent growth to Rs915 billion during July – December 2020 as compared with Rs857.6 billion in the corresponding half of the last fiscal year.
The collection of the federal excise duty stood at Rs127 billion during the half under review as compared with previous collection of Rs125 billion.
Likewise, the collection of customs duty posted 3.06 percent growth to Rs336 billion during the first half of the current fiscal year as compared with Rs326 billion in the corresponding half of the last fiscal year.
The FBR collected Rs508 billion during the month of December 2020 as compared with Rs469 billion in the same month of the last year.
The issuance of refunds increased by 90 percent to Rs102 billion during first half of the current fiscal year as compared with Rs53 billion in the corresponding half of the last fiscal year.
The FBR said that another refund amount of Rs42 billion was issued under Prime Minister Corona Relief Package.
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Share market welcomes New Year with 678 points gain
KARACHI: The share market on Friday welcomed the New Year with a bull run by gaining 678 points on the back of date extension to an amnesty for construction industry and hopes of resolution of debt circular.
The benchmark KSE-100 index of Pakistan Stock Exchange (PSX) closed at 44.435 points as compared with previous day’s close of 43,755 points, showing an increase of 678 points.
Analysts at Topline Securities said that bulls dominated the benchmark KSE-100 index on first trading session of the year, as the index gained to make an intraday high of 1,119 points.
This positivity in the market can be attributed to sources that suggested that IPPs and government have in principle come to an agreement to clear outstanding backlog of circular debt.
Resultantly IPPs, E&Ps and Oil and Gas Marketing sector (all part of the energy chain) lead the rally in market.
Other analysts said that the market responded positively to the announcement of the government to extend the date for the amnesty up to June 30, 2021 for no question on investment made for housing projects.
Some intraday profit taking was observed during the latter part of second trading session, as the index finally settled at 44,435 level (up by 1.55 percent).
Major contribution to the index came from HUBC, OGDC, PPL, PSO and UBL, as they cumulatively contributed 465 points to the index. Traded volume and value for the day stood at 641 million shares and Rs.27.2 billion respectively. POWER was today`s volume lead with 35.8 million shares.
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CDC launches fintech initiative for AMCs
KARACHI: Central Depository Company (CDC) of Pakistan Limited, through its subsidiary ITMinds Limited, has launched the pilot version of a digital platform for the support of the Mutual Fund industry, a statement said on Friday.
This platform, named as “Emlaak Financials”, will function as a digital distribution channel initially for Mutual Funds and later on for other asset classes also.
In the first phase, ‘Emlaak Financials’ will provide a low-cost and centralized solution to investors, initially through covering low-risk investors, but will soon be expanded to a full-fledged distribution mechanism for all types of investors.
The pilot project has been launched with five Asset Management Companies (AMCs); however, soon more AMCs will be on-boarded on the platform. The launch of the pilot project has been officially announced and formalized in an Agreement Signing ceremony at the CDC House, Karachi. Farrukh Sabzwari—Commissioner Specialized Companies Division (SCD) SECP presided the event.
While addressing the occasion, Farrukh Sabzwari—Commissioner SCD SECP said, “It is indeed a very important milestone for the Mutual Fund Industry as it embarks on this consolidated digital distribution channel launched for the first time in Pakistan.
“We, at SECP, are strong proponents of re-engineering processes for promoting efficiency and transparency through digitalization and will continue to support and encourage all such initiatives by providing all the required Regulatory assistance in this regard. Pakistan’s mutual fund segment stands at a meager 1.6 percent of the GDP, which is very low compared to the market’s potential.
“A major obstacle in moving the needle has been limited outreach and focus on specific market segments. The pivotal role of innovation in economic development is undeniable, and I congratulate CDC on coming up with this innovative solution for the Mutual Fund Industry which will lead to higher productivity, reduced turnaround times, lower costs and wider outreach.”
At the occasion, describing the objectives of the platform, Badiuddin Akber—CEO CDC said, “After the successful integration of Roshan Digital Accounts with Capital market, CDC is now launching this new FinTech solution which aims to pave the way for the growth of the Mutual Fund Industry and for promoting financial inclusion in Pakistan at the grass-root level.
“CDC is committed to provide innovative tech-based platforms to Capital Market entities through which they can leverage CDC’s technological edge to enhance their investor outreach in a convenient, informative and interactive manner.”
The event was also attended by representatives of the participating AMCs and CEO MUFAP, Ms. Mashmooma Majeed, who lauded CDC’s efforts in undertaking this initiative and playing its role for the development of the mutual fund industry.
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PTCL license expires
KARACHI: The business operation license of Pakistan Communication Company Limited (PTCL) expired on December 31, 2020 and the company is in discussions with the regulator for the renewal, a statement said on Friday.
According to a communication sent to Pakistan Stock Exchange (PSX), the PTCL said that the integrated license was issued for 25 years effective from January 01, 1996 and valid under December 31, 2020.
Therefore subsequent renewal was required effective form January 01, 2021.
As per terms of PTCL license, PTCL initiated the renewal process by formally requesting Pakistan Telecommunication Authority (PTA) on June 29, 2018 (30 months prior to the expiry / validity of the license).
The PTA responded in affirmative through its letter dated October 01, 2018 that PTCL’s license will be renewed in accordance with the government policy prevalent at the time of renewal.
“Therefore, in the interest of business continuity and operations, PTCL has sought permanent injunction on December 18, 2020 from the Sindh High Court at Karachi by way of filing Suit No. 2081/2020 wherein PTA is restrained from taking any adverse action against the PTCL on expiry of license on December 31, 2020 and not to interfere in the business of PTCL and the provision of services on the basis of license.”
The company said that it was in discussions with the PTA and the federal government to finalize the terms and conditions of the renewed license. “PTCL is confident its license will be renewed at the earliest,” it added.
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Headline inflation contracts to 8.63 percent in first half
ISLAMABAD: The average headline inflation based on Consumer Price Index (CPI) contracted to 8.63 percent during the first half (July – December) of the current fiscal year, Pakistan Bureau of Statistics (PBS) said on Friday.
The average inflation during the same half of the last fiscal year was 11.11 percent, it added. Whereas the average inflation was 5.96 percent during the same half of the fiscal year 2018/2019.
The PBS said that CPI inflation general, increased by8.0 percent on year-on-year basis in December 2020 as compared to an increase of 8.3 percent in the previous month and 12.6 percent in December2019.
On month-on-month basis, it decreased by 0.7 percent in December 2020 as compared to an increase of 0.8 percent in the previous month and a decrease of 0.3 percent in December 2019
CPI inflation Urban, increased by 7.0 percent on year-on-year basis in December 2020 as compared to an increase of 7.0 percent in the previous month and 12.0 percent in December 2019.
On month-on-month basis, it decreased by 0.3 percent in December 2020 as compared to an increase of 0.6 percent in the previous month and a decrease of 0.4 percent in December2019.
CPI inflation Rural, increased by 9.5 percent on year-on-year basis in December 2020 as compared to an increase of 10.5 percent in the previous month and 13.6 percent in December 2019.
On month-on-month basis, it decreased by 1.2 percent in December 2020 as compared to an increase of 1.1 percent in the previous month and a decrease of 0.3 percent in December 2019.
Sensitive Price Indicator (SPI) inflation on YoY increased by 9.1 percent in December 2020 as compared to an increase of 9.9 percent a month earlier and an increase of 18.1 percent in December 2019.
On MoM basis, it decreased by 2.7 percent in December 2020 as compared to an increase of 1.1 percent a month earlier and a decrease of 2.0 percent in December 2019.
Wholesale Price Indicator (WPI) inflation on YoY basis increased by 5.7 percent in December 2020 as compared to an increase of 5.0 percent a month earlier and an increase of 12.4 percent in December 2019.
WPI inflation on MoM basis increased by 0.3 percent in December 2020 as compared to a decrease of 0.9 percent a month earlier and a decrease of 0.3 percent in corresponding month i.e. December 2019.
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FBR clarifies date extension to incentive package for construction industry
The Federal Board of Revenue (FBR) issued a clarification on Thursday, shedding light on the extension of the Prime Minister’s incentive package for the construction industry.
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SECP issues requirement for digital account opening by AMCs
ISLAMABAD: The Securities and Exchange Commission of Pakistan (SECP) on Thursday issued criteria for opening of digital accounts for Pakistani individual customers by Asset Management Companies (AMCs).
Following is minimum criteria for opening of digital accounts for Pakistani Individuals by AMCs:
Eligible customers;
01. Pakistani individual customers having:
i. an active account at any bank/active e-wallet mobile account; and
ii. an active mobile number in his/her own name.
02. Minimum customer information/personal profile/documents required by AMCs:
The customer shall access the online portal (website, mobile App or any third party application) and provide the following minimum information for the purpose of registration:
i. Customer’s name
ii. Father/spouse name
iii. Date of birth
iv. CNIC/identification number with scanned copy along with date of issuance and expiry
v. Existing residential and mailing address
vi. mobile number registered in his/her name
Provided that the AMCs may in special circumstances use where the Pakistani individual customer does not have mobile number in his/her own name, the mobile number of close family member or the mobile number provided to Pakistani individual customers by his/her employer, or the international mobile number of Pakistani individual customer having CNIC/NICOP and an active account at any bank/active E-Wallet mobile account subject to the following:
In case where mobile number of close family member is provided, a duly signed written authorization, on prescribed format, from both the Pakistani individual customers and the person whose mobile number is being provided;
In case where mobile number provided by employer is used, Pakistani individual customer shall provided the bill of service provider in accordance with the procedures and a letter from employer stating that the said mobile number is provided by employer to its employee;
In case where international mobile number is used, Pakistani individual customers shall provide the bill of service provider in accordance with the procedures.
Explanation: For the purpose of this circular, the term ‘close family member’ shall mean and include spouse, dependent parents and dependent children only.
vii. email ID
viii. Mother’s maiden name
ix. Bank/E-Wallet Name and Bank Account IBAN Number / E-Wallet Mobile Account Number
x. Digital / online signature card
xi. Details of nominee
xii. Source of fund/income
xiii. dividend mandate
xiv. operating instructions, if any
xv. statement of account request
xvi. digital/online declaration regarding profession and source of fund/income along with uploading of valid documents as proof thereof
xvii. digital/online undertaking declaring that funds being invested are his/her own funds and that the funds beneficially owned by other persons will not be used and uploading of declaration / undertaking as a proof thereof
xviii. Digital/online consent for account opening and using information/documents provided digitally / online for necessary due diligence and verification functions
xix. Digital / online acceptance of terms and conditions of the account
xx. Any other documents required under AML Act, 2010 and Securities and Exchange Commission of Pakistan (Anti Money Laundering and Countering Financing of Terrorism) Regulations, 2020 (AML/CFT Regulations) (customer specific)
After submission of the required information and documents, a message shall pop up for the customer on the online portal that his/her request is in process and he/she will receive an One Time Password (OTP) once the basic information is verified.
03. Verification by AMCs
AMCs will carry out required due diligence including but not limited to:
a. verification of the CNIC/National Identity Card for Overseas Pakistanis (NICOP)/ Pakistani Origin Card (POC) of customer through NADRA VERISYS;
b. the CNIC and mobile number pairing (whether it is registered in the name of the customer) through Pakistan Mobile Network Database.
Provided further that in all the circumstances mentioned in proviso of clause 2(vi), AMC shall perform digital verification to conduct online face to face interaction on real time basis through any virtual meeting application (Whatsapp, skype etc.) for authentication of the customer and original identification document.
c. Screening of the prospective customer against application sanction regimes (UNSC, NACTA, etc.)
d. IBAN / E-Wallet Mobile Account Number verification through 1-link title fetch service or IBAN/W-Wallet Mobile Account Number and CNIC pairing or Digital Verification to conduct online fact to face interaction on real time basis through any virtual meeting application (Whatsapp, skype etc.) for authentication of the customer and original identification document;
Provided that for such Pakistani individual customer who do not have mobile number is their own name or provide international mobile number, IBAN/E-Wallet Mobile Account Number verification through 1-Link title fetch service or IBAN/E-Wallet Mobile Account Number and CNIC Pairing and Digital Verification to conduct online face to face interaction on real time basis shall be mandatory.
e. Verification of contact details through one time password, email or call back;
In case the verification is successful, an OTP shall be generated and immediately sent on the designated mobile number and/or email address of the customer, as the case may be, valid for a limited period of time.
f. AMC shall ensure before opening the account that all documents required for screening and risk rating are available and it can conduct screening and risk rating.
g. the customer will not be allowed to proceed in case the information cannot be successfully verified by AMC.
04. Account Opening and Activation:
The AMC will proceed with opening of account after the customer has successfully accessed the portal using the OTP. Account may be opened after due diligence checks and satisfactory completion of the requirements. The opening of customer account shall be subject to compliance with all other applicable legal and regulatory requirements.
05. Additional Measures by AMC:
> AMCs shall develop SOPs for:
* Information and documents to be collected through website/mobile App;
* Turnaround time (TAT) for decision to open or decline account is 3 working days from the time of upload of all information/documents. In case of any discrepancy in documents or where additional documents are required, AMC would revert back to customer within three working days;
> AMCS shall not open digital/online accounts in joint names;
> AMCs may record the real time online fact to face interaction call with the customer while carry out KYC process for opening of account;
> AMCS to ensure data/ privacy protection, safety and security of information/ documents through reliable IT infrastructure;
> AMCs should ensure to deploy necessary technical infrastructure and system while establishing business relationship through e-KYC to comply with AML/CFT regime of the country;
> After opening of account, as part of ongoing monitoring and customer due diligence, AMCs may seek additional information from customers based on their ongoing internal risk assessment and compliance framework;
> AMCs may carryout periodical re-profiling of the customers in accordance with AML/CFT policy;
> AMCs shall deploy adequate controls to ensure that customer is not a robot (e.g. CATPCHA Codes);
> AMCs shall ensure customer care service through call center;
> To eliminate the risks of impersonation of the customer or identity theft, the AMC should take appropriate security measures;
06. Types of CIS offered by AMCs
> All types of mutual funds may be offered to the customers subject to minimum investment limits as per the Constitutive Document of the fund and compliance with disclosure, disclaimer, risk profiling, risk categorization and other regulatory requirements.
AMCs shall at all times comply with all requirements of AML Act, 2010 and AML/CFT Regulations, 2020 issued by SECP from time to time.