Author: Mrs. Anjum Shahnawaz

Non-ATL retailers to pay double amount of fixed tax

ISLAMABAD: Small retailers or a shopkeepers have to pay double the amount of fixed tax in case of not appearing on the Active Taxpayers List (ATL).

The federal government through the Finance Bill, 2022 introduced a scheme of fixed tax for small retailers.

However, the National Assembly approved the bill with certain changes in the fixed tax regime. The Finance Act, 2022 now has binding on the small retailer to register themselves with the tax department and appear on the Active Taxpayers list (ATL) in order to avail the fixed tax facility.

Otherwise, in case of not appearing on the ATL, the small retailer is required to pay one hundred per cent more on the amount of fixed tax.

In order to collect the tax under this regime, the government decided to recover the amount through electricity bill.

In this regard certain amendments have been made to Sales Tax Act, 1990 and Income Tax Ordinance, 2001.

In sub section 9, Section 3 of Sales Tax Act, 1990, a new proviso has been inserted through the Finance Act, 2022, which stated:

“Provided that the above rates of tax shall be increased by one hundred percent if the name of the person is not appearing in the Active Taxpayers List issued by the Board under section 181A of the Income Tax Ordinance, 2001 on the date of issuance of monthly electricity bill.”

Similarly, a new Section 99A has been inserted to the Income Tax Ordinance, 2001 and approved through the Finance Act, 2022, which is as follow:

“99A. Special provisions relating to payment of tax through electricity connections.

(1) Notwithstanding anything contained in the Ordinance, a tax shall be charged and collected from retailers other than Tier-I retailers as defined in Sales Tax Act, 1990 (VII of 1990) and specified service providers on commercial electricity connections at the rates provided in clause (2A) of Division IV, Part IV of the First Schedule.

(2) A retailer who has paid sales tax under sub-section (9) of section 3 of Sales Tax Act, 1990 (VII of 1990), shall not be required to pay tax under this section and the sales tax so paid shall constitute discharge of tax liability under this section.

(3) The tax collected or paid under this section shall be final tax on the income of persons covered under this section in respect of business being carried out from the premises where the electricity connection is installed.

(4) For the purposes of this section, Board with the approval of the Minister in-charge may issue an income tax general order to-

(a) provide the scope, time, payment, recovery, penalty, default surcharge, adjustment or refund of tax payable under this section in such manner and with such conditions as may be specified.

(b) provide record keeping, filing of return, statement and assessment in such manner and with such conditions as may be specified;

(d) include or exempt any person or classes of persons, any income or classes of income from the application of this section, in such manner and with such conditions as may be specified.”

The rate of tax leviable under section (99A), and collectable under sub section (1A) of Section 235 shall be as under:-

Gross amount of monthly bill	Tax
Where the amount does not exceed Rs. 30,000	Rs. 3000
Where the amount exceeds Rs. 30,000 but does not exceed Rs. 50,000	Rs. 5000
Where the amount exceeds Rs. 50,000 but doesnot exceed Rs. 100,000	Rs. 10,000
Specified retailers and service providers through Income Tax General Order	Rs.50,000

July 5, 2022

FBR notifies companies return forms for tax year 2022

The Federal Board of Revenue (FBR) in Pakistan has officially released the income tax return forms for companies for the tax year 2022, signaling the commencement of the annual tax filing season.
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July 4, 2022
FBR issues business individuals return forms for tax year 2022

The Federal Board of Revenue (FBR) has taken a significant step towards initiating the annual tax filing process by issuing income tax return forms for business individuals for the tax year 2022.
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July 4, 2022
FBR notifies AOP return form tax year 2022

The Federal Board of Revenue (FBR) has taken a significant step towards enhancing tax transparency by releasing income tax return forms for Association of Persons (AOPs) for the tax year 2022.
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July 3, 2022
FBR issues salary return form for tax year 2022

The Federal Board of Revenue (FBR) has taken a significant step in facilitating tax compliance by issuing income tax return forms specifically tailored for salaried individuals for the tax year 2022.
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July 3, 2022
NA approves levy on petroleum products up to Rs50/liter

ISLAMABAD: National Assembly (NA) has approved a levy of Rs50 per liter on each petroleum product.

The assembly allowed the government to include the levy in the prices of petroleum products up to Rs50 per liter of each product.

READ MORE: All tax proposals of IT sector accepted: FBR

The National Assembly passed the Finance Act, 2022 that empowers the government to enforce the laws that were amended through federal budget 2022/2023.

In this regard amendment has been made to Petroleum Products (Petroleum Levy) Ordinance, 1961.

READ MORE: Pakistan’s salaried class unhappy over new tax changes

In this ordinance the fifth schedule has been amended as following:

High Speed Diesel: Rs50/liter

Motor Gasoline (Petrol): Rs50/liter

Superior Kerosene Oil (SKO): Rs50/liter

Light Diesel Oil (LDO): Rs50/liter

READ MORE: Pakistan reduces salary tax slabs to 7 in budget 2022/23

High Octane Blending Component (HOBC): Rs50/liter

E-10 Gasoline: Rs50/liter

Liquefied Petroleum Gas (Produced/extracted in Pakistan): Rs30,000 per metric ton.

The government has estimated a collection of Rs750 billion as petroleum levy during the fiscal year 2022/2023.

READ MORE: Pakistan reduces salary tax slabs to 7 in budget 2022/23

It is worth mentioning that the previous PTI government had not imposed a petroleum levy in order to provide petroleum products at cheaper rates.

However, the current coalition government led by PML-N in its budget 2022/2023 announced on June 10, 2023 estimated collection of Rs750 billion during the current fiscal year.

July 2, 2022
Pakistan allows duty exemption on coal import from Afghanistan

ISLAMABAD: Pakistan has allowed exemption of customs duty on import of coal from Afghanistan.

The country’s apex revenue authority i.e. Federal Board of Revenue (FBR) issued SRO 968(I)/2022 to exempt customs duty on import of certain items, including coal from Afghanistan.

Earlier this week Prime Minister Muhammad Shehbaz Sharif approved the import of super-critical quality coal from Afghanistan in Pakistani rupee instead of dollars to help generate low-cost electricity in the country.

READ MORE: Govt. may exempt customs duty in emergency situation

The prime minister, chairing a meeting to improve the mechanism for transportation of Afghan coal, expressed concerns over the rising price of coal in the international market.

He said the rise in coal price was also one of the reasons behind the generation of expensive electricity by the coal power plants operating in the country.

He viewed that the import of Afghan coal in Pakistani currency would save the foreign exchange.

The prime minister was told that the import of Afghan coal – initially for Sahiwal and Hub power plants – would save around $2.2 billion annually.

READ MORE: Rate of customs duty in Pakistan on imports

The FBR allowed duty exemption on import of following goods: Description (Pakistan Customs Tariff)

Other Coal (2701.1900)

Bituminous coal (2701.1200)

Talc (2526.1010)

Marble (Crude or roughly trimmed) (2515.1100)

Plants & parts of plants (including seed & fruit) (1211.9000)

Seeds of cumin neither crushed nor grounded (0909.3100)

Sulphur of all kinds, other than sublimed sulphur (2503.0000)

Yams (Dioscorea spp.) (0714.3000)

Containers (including containers for the transport of fluids) (8609 0000)

The FBR said that the SRO would take effect from July 01, 2022.

July 2, 2022
Pakistan opens return filing portal for tax year 2022

ISLAMABAD: Pakistan on Friday opened the income tax return filing portal for tax year 2022. The return filing portal will remained available till September 30, 2022, as three months are statutory time period for filing income tax return.

Salaried persons, business individuals, Association of Persons (AOPs) and Companies having special account year will file the income tax return during this period.

The Federal Board of Revenue (FBR) issued SRO 978(I)/2022 to notify finalized income tax return form for the tax year 2022.

Following are the categories of taxpayers who required to file income tax return for tax year 2022 under Income Tax Ordinance, 2001:

Section 14 of Income Tax Ordinance, 2001 has explained in detail about persons whom the annual return filing is mandatory. According to the Section:

READ MORE: Who needs to file Tax Year 2022 return in Pakistan?

114. Return of income. — (1) Subject to this Ordinance, the following persons are required to furnish a return of income for a tax year, namely:–

(a) every company;

(ab) every person (other than a company) whose taxable income for the year exceeds the maximum amount that is not chargeable to tax under this Ordinance for the year; or

(ac) any non-profit organization as defined in clause (36) of section 2;

(ae) every person whose income for the year is subject to final taxation under any provision of this Ordinance;

READ MORE: FBR issues draft return forms for tax year 2022

(b) any person not covered by clause (a), (ab), (ac) or (ad) who,—

(i) has been charged to tax in respect of any of the two preceding tax years;

(ii) claims a loss carried forward under this Ordinance for a tax year;

(iii) owns immovable property with a land area of five hundred square yards or more or owns any flat located in areas falling within the municipal limits existing immediately before the commencement of Local Government laws in the provinces; or areas in a Cantonment; or the Islamabad Capital Territory;

(iv) owns immoveable property with a land area of five hundred square yards or more located in a rating area;

(v) owns a flat having covered area of two thousand square feet or more located in a rating area;

(vi) owns a motor vehicle having engine capacity above 1000 CC;

READ MORE: Tax return filing starts from July 01, 2022

(vii) has obtained National Tax Number; or

(viii) is the holder of commercial or industrial connection of electricity where the amount of annual bill exceeds rupees five hundred thousand;

(ix) is a resident person registered with any chamber of commerce and industry or any trade or business association or any market committee or any professional body including Pakistan Engineering Council, Pakistan Medical and Dental Council, Pakistan Bar Council or any Provincial Bar Council, Institute of Chartered Accountants of Pakistan or Institute of Cost and Management Accountants of Pakistan; or

(x) is a resident person being an individual required to file foreign income and assets statement under section 116A.

(c) persons or classes of persons notified by the Board with the approval of the Minister in-charge.

(1A) Every individual whose income under the head ‘Income from business’ exceeds rupees three hundred thousand but does not exceed rupees four hundred thousand in a tax year is also required to furnish return of income from the tax year.

July 1, 2022
Pakistan stocks up 89 points in lackluster trading

KARACHI: Pakistan stocks ended up 89 points on Friday in a lackluster trading during the day.
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July 1, 2022
Petroleum prices in Pakistan push inflation 13-year high

KARACHI: The continuous rise in petroleum prices in Pakistan have pushed headline inflation up 13-year high at 21 per cent in June 2022.
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July 1, 2022