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Day: June 20, 2021

  • Pakistan likely to exit from FATF’s grey list

    Pakistan likely to exit from FATF’s grey list

    KARACHI: The plenary meeting of Financial Action Task Force (FATF) is scheduled to start from June 21, 2021. The meeting may decide to give green signal to Pakistan for white list or maintain its status in the grey list.

    The virtual plenary meeting of the FATF will continue till June 25, 2021. It is hoped the watchdog would give clear Pakistan from its strict monitoring list as the country had done immense progress in meeting the required actions.

    The Asia Pacific Group on Money Laundering (APG) – an arm of FATF- in its mutual evaluation of Pakistan released in May 2021 welcomed the efforts of the country in meeting most of the actions set by the FATF.

    “Overall, Pakistan has made notable progress in addressing the technical compliance deficiencies identified in its MER and has been re-rated on 22 Recommendations.

    “Recommendations 14, 19, 20, 21 and 27 have been re-rated to compliant, and recommendations R.1, 6, 7, 8, 12, 17, 22, 23, 24, 25, 30, 31, 32, 35 and 40 to largely compliant.

    “Recommendation 28 has been re-rated to partially compliant. Insufficient progress has been made to re-rate Recommendation 38. Compliance with Recommendation 37 has been downgraded to non-compliant,” the report said.

    Pakistan government is hopeful that the FATF would delist the country from grey list.

    “Pakistan has achieved compliant rating in 31 out of 40 FATF recommendations (MER technical compliance). This is the parallel scrutiny being undertaken at FATF besides our current action plan. Upgrade of 20 criteria in less than 2 years is unprecedented in FATF history for any country,” Hammad Azhar, a federal minister, said in his tweet on June 04, 2021.

    The FATF put Pakistan in grey list in the year 2018.

  • Tax Rates for Individuals and Association of Persons

    Tax Rates for Individuals and Association of Persons

    ISLAMABAD: The government has decided to retain the tax rates for individuals and Association of Persons (AOPs) for the year 2021-2022, sources in Federal Board of Revenue (FBR) said.

    Since there is no change proposed through the Finance Bill, 2021 the rates applicable in Tax Year 2021 shall remain applicable in Tax Year 2022.

    Rates of Tax for Individuals and Association of Persons

    (1) Subject to clause (2), the rates of tax imposed on income of every individual and association of persons except a salaried individual shall be as set out in the following Table, namely:—

    TABLE

    S. No.Taxable incomeRate of tax
    (1)(2)(3)
    1.Where taxable income does not exceed Rs. 400,0000%
    2.Where the taxable income exceeds Rs. 400,000 but does not exceed Rs. 600,0005% of the amount exceeding Rs. 400,000
    3.Where taxable income exceeds Rs. 600,000 but does not exceed Rs. 1,200,000Rs. 10,000 plus 10% of the amount exceeding Rs. 600,000
    4.Where taxable income exceeds Rs.1,200,000 but does not exceed Rs. 2,400,000Rs. 70,000 plus 15% of the amount exceeding Rs. 1,200,000
    5.Where taxable income exceeds Rs. 2,400,000 but does not exceed Rs. 3,000,000Rs. 250,000 plus 20% of the amount exceeding Rs. 2,400,000
    6.Where taxable income exceeds Rs. 3,000,000 but does not exceed Rs. 4,000,000Rs. 370,000 plus 25% of the amount exceeding Rs. 3,000,000
    7.Where taxable income exceeds Rs. 4,000,000 but does not exceed Rs. 6,000,000Rs. 620,000 plus 30% of the amount exceeding Rs. 4,000,000
    8.Where taxable income exceeds Rs. 6,000,000Rs. 1,220,000 plus 35% of the amount exceeding Rs. 6,000,000
  • Super tax permanently imposed on banking companies

    Super tax permanently imposed on banking companies

    ISLAMABAD: The levy of super tax has been permanently imposed on banking companies as it was expiring in the tax year 2021.

    Sources in the Federal Board of Revenue (FBR) said that the super tax was only imposed on banking companies while the other taxpayers were exempted from tax year 2020.

    The sources said that the Finance Bill 2021 had proposed to continue the levy of super tax at 4 percent on banking companies beyond Tax Year 2021 and onwards.

    The government imposed the super tax through Finance Act, 2015 for one year, which was later extended for subsequent years, by inserting Section 4B to the Income Tax Ordinance, 2001.

    According to Section 4B:

    Super tax for rehabilitation of temporarily displaced persons.― (1) A super tax shall be imposed for rehabilitation of temporarily displaced persons, for tax years 2015 and onwards, at the rates specified in Division IIA of Part I of the First Schedule, on income of every person specified in the said Division.

    (2) For the purposes of this section, “income” shall be the sum of the following:—

    (i) profit on debt, dividend, capital gains, brokerage and commission;

    (ii) taxable income (other than brought forward depreciation and brought forward business losses) under section (9) of this Ordinance, if not included in clause (i);

    (iii) imputable income as defined in clause (28A) of section 2 excluding amounts specified in clause (i); and

    (iv) income computed, other than brought forward depreciation, brought forward amortization and brought forward business lossess under Fourth, Fifth, Seventh and Eighth Schedules.

    (3) The super tax payable under sub-section (1) shall be paid, collected and deposited on the date and in the manner as specified in sub-section (1) of section 137 and all provisions of Chapter X of the Ordinance shall apply.

    (4) Where the super tax is not paid by a person liable to pay it, the Commissioner shall by an order in writing, determine the super tax payable, and shall serve upon the person, a notice of demand specifying the super tax payable and within the time specified under section 137 of the Ordinance.

    (5) Where the super tax is not paid by a person liable to pay it, the Commissioner shall recover the super tax payable under subsection (1) and the provisions of Part IV,X, XI and XII of Chapter X and Part I of Chapter XI of the Ordinance shall, so far as may be, apply to the collection of super tax as these apply to the collection of tax under the Ordinance.

    (6) The Board may, by notification in the official Gazette, make rules for carrying out the purposes of this section.

  • Salary Tax Rates for year 2021-2022

    Salary Tax Rates for year 2021-2022

    ISLAMABAD: The Finance Bill 2021 has not proposed changes to tax rates and slabs for salaried persons for tax year 2022, sources in the Federal Board of Revenue (FBR) said.

    Therefore tax rate and slabs will remain unchanged for tax year starting from July 01, 2021.

    Following is the table for tax rates on taxable income of salaried persons prevailed during tax year 2021:

    Where the income of an individual chargeable under the head “salary” exceeds seventy-five per cent of his taxable income, the rates of tax to be applied shall be as set out in the following table, namely:—

    01. Where taxable income does not exceed Rs. 600,000: the tax is zero per cent

    02. Where taxable income exceeds Rs. 600,000 but does not exceed Rs. 1,200,000: the tax rate is 5% of the amount exceeding Rs. 600,000

    03. Where taxable income exceeds Rs. 1,200,000 but does not exceed Rs. 1,800,000: the tax rate is Rs. 30,000 plus 10% of the amount exceeding Rs. 1,200,000

    04. Where taxable income exceeds Rs. 1,800,000 but does not exceed Rs. 2,500,000: the tax rate is Rs. 90,000 plus 15% of the amount exceeding Rs. 1,800,000

    05. Where taxable income exceeds Rs.2,500,000 but does not exceed Rs. 3,500,000: the tax rate is Rs. 195,000 plus 17.5% of the amount exceeding Rs. 2,500,000

    06. Where taxable income exceeds Rs. 3,500,000 but does not exceed Rs. 5,000,000: the tax rate is Rs. 370,000 plus 20% of the amount exceeding Rs. 3,500,000

    07. Where taxable income exceeds Rs. 5,000,000 but does not exceeds Rs. 8,000,000: the tax rate is Rs. 670,000 plus 22.5% of the amount exceeding Rs. 5,000,000

    08. Where taxable income exceeds Rs. 8,000,000 but does not exceeds Rs. 12,000,000: the tax rate is Rs. 1,345,000 plus 25% of the amount exceeding Rs. 8,000,000

    09. Where taxable income exceeds Rs. 12,000,000 but does not exceeds Rs. 30,000,000: the tax rate is Rs. 2,345,000 plus 27.5% of the amount exceeding Rs. 12,000,000

    10. Where taxable income exceeds Rs. 30,000,000 but does not exceeds Rs. 50,000,000: the tax rate is Rs. 7,295,000 plus 30% of the amount exceeding Rs. 30,000,000

    11. Where taxable income exceeds Rs. 50,000,000 but does not exceeds Rs. 75,000,000: the tax rate is Rs. 13,295,000 plus 32.5% of the amount exceeding Rs. 50,000,000

    12. Where taxable income exceeds Rs. 75,000,000: the tax rate is Rs. 21,420,000 plus 35% of the amount exceeding Rs. 75,000,000

    Salary income explained by tax ordinance
  • FBR to confiscate goods without brand licensing

    FBR to confiscate goods without brand licensing

    In a bid to enhance regulatory oversight and combat counterfeiting, the proposal to make brand licensing mandatory for manufacturers of specified goods has been put forward. In the event of non-compliance, the Federal Board of Revenue (FBR) is poised to be empowered with the authority to confiscate such items.

    (more…)
  • Export orders under threat as gas supply to industries suspended

    Export orders under threat as gas supply to industries suspended

    KARACHI: Industrial activities come to a standstill as gas supply was suspended by Sui Southern Gas Company (SSGC). The suspension would affect meeting export orders.

    Abdul Hadi, President, Site Association of Industry, while expressing deep concern on Saturday over non-supply of gas to the industries of the site area, said that Sui Southern Gas Company (SSGC) has suspended the supply of gas to the industries.

    “As a result, the gas crisis has intensified and production activities have come to a standstill position and many industries have been shut down. He demanded to restore Gas supply to the industries at the required pressure so that production activities can be resumed.”

    He appealed to Prime Minister Imran Khan and Federal Minister for Energy Hammad Azhar, to take notice of the non-supply of gas, Abdul Hadi said that the industries of the site area have been facing shortage of gas for a week and now the supply of gas has been suspended.

    “The non-supply of gas is affecting production activities, which has led to the closure of several industries. Gas pressure is constantly zero and despite repeated complaints to the SSGC, the gas pressure has not been improved. On the contrary, SSGC has taken the position that it may take another 2 to 3 days to improve the gas pressure, which is an alarm for the fulfilment of export orders”, he pointed out.

    SAI chief questioned the SSGC officials that if there is such a situation of gas supply in summer, then what will happen to the gas crisis in winter? Abdul Hadi requested Prime Minister Imran Khan and Federal Minister for Energy Hammad Azhar to issue directives to SSGC to restore gas at required pressure to the industries of the site. Otherwise timely delivery of export orders will not be possible.