Day: June 7, 2021

NEC approves GDP growth target at 4.8pc for 2021/2022

ISLAMABAD: Prime Minister Imran Khan on Monday chaired a meeting of the National Economic Council. Chief Ministers of all the Provinces and other members of the NEC participated in the meeting.

The NEC approved the Macroeconomic Framework for Annual Plan 2021-2022. The NEC also approved the GDP growth projections for the financial year 2021-2022.

The proposed growth target of 4.8 percent was approved, with sectoral growth targets of 3.5 percent for Agriculture, 6.5 percent for Industrial Sector, and 4.7 percent for the Services Sector.

Ministry of Planning Development and Special Initiatives presented the Public Sector Development Program (PSDP) for 2021-22.

NEC was informed that the revised estimate for the total development outlay of the ongoing year is Rs. 1527 billion. As against this the total development outlay for the next financial year would be over Rs. 2100 billion, including PSDP of Rs. 900 billion. This includes Rs. 244 billion for Transport & Communications, Rs. 118 billion for Energy, Rs. 91 billion for Water Resources, Rs. 113 billion for social Sector, Rs. 100 billion for Regional Equalization, Rs. 31 billion for Science & Technology & IT Sector, Rs. 68 billion for SDGs and Rs. 17 billion for Production Sector.

The Council was informed that the focus of PSDP will be on Infrastructure improvement, Water Resources Development, Social Sector improvement, Regional Equalization, Skill Development, promotion of Science & Technology, and IT, as well as Climate Change mitigation measures.

The meeting was informed that the PSDP would cater to the government’s plans to increase focus on lagging areas and regions. For this purpose, sufficient allocations have been made for projects of South Balochistan, various districts of Sindh, as well as for Gilgit Baltistan.

Allocations have also been made for infrastructure projects of South districts of Punjab.

Similarly, an allocation of Rs. 54 billion has been made for the newly merged districts of KP.

In the Social Sectors, Higher Education Commission has been allocated Rs. 42 billion.

NEC was informed that with the operationalization of the PPP Authority, a number of PPP projects are also being expeditiously processed for implementation. These include Sukur-Hyderabad Motorway and Sialkot-Kharian Motorway, which are at an advanced stage. While other major projects such as Karachi Circular Railway (KCR), KPT-PIPRI Freight Corridor, Kharian – Rawalpindi Motorway, Balkasar – Mianwali Road, Quetta – Karachi – Chaman Highway are also likely to be launched during the year.

The Government has, for the first time ever made an allocation of Rs. 61 billion in PSDP for financing the viability gap of PPP projects, to make sure that PPP projects can be successfully implemented.

Addressing the meeting the Prime Minister emphasized on increasing the pace of implementation of development projects to ensure that the gains made through stabilization of the economy could be translated into economic growth resulting in the well-being of the people of Pakistan.

June 7, 2021
Introduction of new tax regime under consideration: Tarin

ISLAMABAD: Finance Minister Shaukat Tarin on Monday said that the government is considering to introduce a new tax regime that is in accordance with the changing economic environment.

The finance minister said this at a meeting with Managing Director / CEO Pakistan Stock Exchange Farrukh H. Khan to review proposals for Federal Budget 2021-2022.

The Federal Minister for Finance and Revenue, Shaukat Tarin, chaired the meeting here at the Finance Division with Adviser to PM on Austerity and Institutional Reforms Dr. Ishrat Hussain, SAPM on Finance and Revenue Dr. Waqar Masood, Chairman FBR and Secretary Finance Division were also present during the meeting.

MD, Pakistan Stock Exchange (PSX) gave a detailed presentation on the huge impact of stock markets on wealth creation and mobilization of capital.

He said that a broad-based capital market helps to achieve important economic and social objectives like increasing the number of tax payers, optimizing savings and investment rates, and reducing wealth inequalities.

Tax measures are an important policy tool to increase investments and savings in the economy and to stay competitive with other markets.

The Managing Director submitted proposals to align rates of capital gain tax on disposal of securities in line with regional practices, rationalization of tax rates for companies listed on the stock exchange, enhanced tax credit for listed small and medium enterprises, unlocking the potential of private funds and many other suggestions that will help broadening the tax base/ revenue collection.

The finance minister appreciated the recommendations from the MD Stock Exchange and said that the present government is strongly committed to strengthening of the financial markets and is ready to adopt measures that could mobilize capital to more productive sectors.

Shaukat Tarin welcomed the proposals and assured that these will be given due consideration in the upcoming budget.

June 7, 2021
Wearing uniform made mandatory for all Customs officers

ISLAMABAD: The Federal Board of Revenue (FBR) has made it mandatory of wearing uniform for officials in the grades up to BS-21 of Pakistan Customs Service (PCS).

The FBR issued SRO 722(I)/2021 on Monday to notify draft rules for making mandatory the wearing of uniform by all customs officials from July 01, 2021.

The FBR said that the purpose of the single uniform is to enhance the espirit de corps.

The revenue body said that there shall be service and office uniform of Charcoal Grey colour for all the officers and officials as prescribed from BS-I to BS-21, of Pakistan Customs Service.

Uniform allowance shall be made permanent part of the salary as per admissible limits determined from time to time by the FBR.

The FBR said that a Customs General Order (CGO) would be issued for the detailed design, description and accessories of the uniform.

All ranks of Pakistan Customs Service whether serving in Collectorates or Directorates except FBR Headquarters, shall wear the prescribed uniform with specific formation insignia as prescribed in the CGO issued in this regard.

“All ranks shall abide by the instructions or guidelines contained in the CGO for manners, etiquettes, appearance and official conduct whilst wearing uniform,” the FBR said.

Any breach of the guidelines as mentioned above, respective CGO or guidance notes annexed to the CGO shall be construed as misconduct under Civil Servants (Efficiency and Discipline) Rules, 2020, and may entail disciplinary proceedings, it added.

June 7, 2021
Stock market gains 91 points amid selling pressure

KARACHI: The stock market witnessed a gain of 91 points on Monday amid heavy selling despite positive news flows related to budgetary measures.

The benchmark KSE-100 index of Pakistan Stock Exchange (PSX) closed at 48,303 points as against last Friday’s closing of 48,212 points, showing an increase of 91 points.

Analysts at Arif Habib Limited said that the market saw heavy selling pressure today against all the positive news flow that came to fruition over the weekend, from possible reduction in CGT to duty reduction for Auto manufacturers and release of circular debt related payments to IPPs.

Reportedly, ISL increased steel prices today which helped the stock price gain during the session, however profit booking brought the price below LDCP by the closing. E&P, Refinery, O&GMCs, Technology stocks bore selling pressure.

KAPCO, which was the main beneficiary of release of circular debt related funds from the Government, could not stand firmly and selling pressure brought its price below LDCP briefly. Among scrips, HUMNL topped the volumes with 118 million shares, followed by WTL (80.5 million) and PTC (64.6 million).

Sectors contributing to the performance include Glass (+22 points), Fertilizer (+19 points), Textile (+18 points), Power (+14 points) and Cement (+12 points).

Volumes increased from 867.3 million shares to 936 million shares (+7 percent DoD). Average traded value also increased by 4 percent to reach US$ 178.3 million as against US$ 171.9 million.

Stocks that contributed significantly to the volumes include HUMNL, WTL, PTC, BYCO and TELE, which formed 37 percent of total volumes.

Stocks that contributed positively to the index include SYS (+27 points), GHGL (+22 points), KTML (+19 points), HUBC (+12 points) and PTC (+11 points). Stocks that contributed negatively include TRG (-25 points), PSO (-12 points), PPL (-10 points), NML (-9 points) and HBL (-9 points).

June 7, 2021
Rupee falls by 69 paisas on import payment demand

KARACHI: The Pak Rupee fell by 69 paisas against the dollar on Monday owing to higher demand for import payments as the market opened after two weekly holidays.

The rupee ended Rs155.31 to the dollar from last Friday’s closing of Rs154.62 in the interbank foreign exchange market.

Currency experts said that the rupee was weakened as the market had seen higher demand of the foreign currency for import and corporate payments.

They said that the higher demand for the foreign currency was due to market was opened after two weekly holidays.

June 7, 2021
FBR urged to issue FTNs against withholding tax deduction

KARACHI: Tax practitioners have urged the Federal Board of Revenue (FBR) to issue Fee Tax Numbers (FTNs) to persons who are not liable for withholding tax.

In its proposals for budget 2021/2022, the Karachi Tax Bar Association (KTBA) said that Section 49(3) of the Income Tax Ordinance, 2001 has specified that any payment received by the Federal Government, a Provincial Government or a Local Government shall not be liable to any collection or deduction of advance tax.

No clarification or list of FTN entities to whom this subsection applies, the tax bar said.

In absence of any SRO or underlying Rules causes unease to the withholding agents to determine proper withholding tax treatment in such case.

FBR should issue a separate list of Fee Tax Numbers (FTNs), who are not liable to tax withholding as provided under section 49(3) of the Ordinance through a S.R.O.

The KTBA said that this will assist the withholding agents and save considerable time in deciding whether a respective FTN holder is required to produce exemption certificate or not.

June 7, 2021
KTBA proposes amendments to automatic stay in recovery cases

KARACHI: Karachi Tax Bar Association (KTBA) has recommended amendments to provisions of the Income Tax Ordinance, 2001 related to automatic stay in recovery notices.

It is proposals for budget 2021/2022, the KTBA said that Sub-Section (2) of Section 138 if Income Tax Ordinance, 2001 provides that If the amount referred to in the notice issued under sub-section (1) is not paid within the time specified therein or within the further time, if any, allowed by the Commissioner, the Commissioner may proceed to recover from

— the taxpayer the said amount by one or more of the following modes, namely:

— attachment and sale of any movable or immovable property of the taxpayer;

— appointment of a receiver for the management of the movable or immovable property of the taxpayer.

— arrest of the taxpayer and his detention in prison for a period not exceeding six months arrest of the taxpayer and his detention in prison for a period not exceeding six months

Provision of automatic stays not all exhaustive.

The tax bar said that if a person pays ten percent of the disputed demand under section 140 even then the recovery from taxpayers may be made through the modes envisaged under sub-section (2) of section 138 which is harsh and rendered section 140 redundant and superfluous.

The tax bar proposed that the condition of the payment of ten percent of amount due shall also be made applicable for section 138 to create synchronization between section 138 and 140 of the Ordinance.

The proposed amendment seeks to address the inequity afforded in the law.

June 7, 2021