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Author: Mrs. Anjum Shahnawaz

  • Prices of essential items increase by 32.82%

    Prices of essential items increase by 32.82%

    ISLAMABAD: The prices of essential items in Pakistan have registered a growth of 32.82 per cent Year on Year (YoY) basis by week ended July 21, 2022.

    According to weekly inflation based on Sensitive Price Indicator (SPI) data released by Pakistan Bureau of Statistics (PBS), the prices of essential items increased by 32.82 per cent by week ended July 21, 2022 when compared with July 22, 2022.

    READ MORE: Pakistan inflation crosses 33% on high petroleum prices

    The SPI is computed on weekly basis to assess the price movements of essential commodities at shorter interval of time so as to review the price situation in the country.

    The SPI comprises of 51 essential items collected from 50 markets in 17 cities of the country.

    The year on year trend depicts an increase of 32.82 per cent, Diesel (106.16 per cent), Petrol (103.34 per cent), Pulse Masoor (91.29 per cent), Onions (88.46 per cent), Vegetable Ghee 1 Kg (76.85 per cent), Mustard Oil (75.78 per cent), Cooking Oil 5 litre (75.35 per cent), Vegetable Ghee 2.5 Kg (71.71 per cent), Washing Soap (60.25 per cent), Chicken (58.41 per cent), Gents Sponge Chappal (52.21 per cent), Pulse Gram (51.46 per cent), Garlic (43.70 per cent) and LPG (40.47 per cent).

    READ MORE: Petroleum prices in Pakistan push inflation 13-year high

    While major decrease observed in the prices of Chillies Powdered (43.42 per cent), Sugar (15.51 per cent), Tomatoes (6.18 per cent), Gur (2.72 per cent) and Pulse Moong (0.72 per cent).

    The SPI for the current week ended on July 21, 2022 recorded a decrease of 0.22 per cent. Decrease observed in the prices of food items, Tomatoes (7.04 per cent), Bananas (3.34 per cent), Vegetable Ghee 1 Kg (1.14 per cent), Onions (0.46 per cent), Sugar (0.44 per cent), Vegetable Ghee 2.5 Kg (0.42 per cent), Gur (0.32 per cent) and Rice Basmati Broken (0.19 per cent), non-food items Diesel (14.62 per cent) and Petrol (7.41 per cent), with joint impact of (-1.03 per cent) into the overall SPI for combined group of (-0.22 per cent).

    READ MORE: Average inflation estimated up to 12% in FY22

    On the other hand, an increase observed in the prices of Chicken (3.80 per cent), Georgette (3.44 per cent), Shirting

    (2.53 per cent), Garlic (2.25 per cent), Pulse Mash (2.07 per cent), Potatoes (1.56 per cent), Pulse Masoor (1.43 per cent), Pulse Moong (1.39 per cent), Cooking Oil 5 litre (1.35 per cent) and Tea Lipton (1.29 per cent).

    During the week, out of 51 items, prices of 31 (60.78 per cent) items increased, 11 (21.57 per cent) items decreased and 09 (17.65 per cent) items remained stable.

    READ MORE: Average inflation estimated up to 12% in FY22

  • Rupee hits new midday low of Rs228.50 against dollar

    Rupee hits new midday low of Rs228.50 against dollar

    KARACHI: The Pakistani Rupee (PKR) made a new midday trading low of Rs228.50 against the US dollar on Friday in interbank foreign exchange market.

    The dollar is being traded at Rs228.50, up Rs1.69 from last day’s closing of Rs226.81 in the interbank foreign exchange market.

    READ MORE: Rupee ends to new low at Rs226.81 against dollar in interbank

    Currency experts said that the rupee under severe pressure due to high dollar demand for external payments.

    The foreign exchange reserves of the country have further declined.

    Pakistan’s foreign exchange reserves have declined by $368 million to $15.242 billion by week ended July 15, 2022. The foreign exchange reserves of the country were $15.61 billion a week ago i.e. July 07, 2022.

    READ MORE: PKR plunges Rs227 to dollar at interbank midday trading

    The country’s foreign exchange reserves hit all-time high of $27.228 billion on August 27, 2021. Since then the foreign exchange reserves have declined by $11.986 billion.

    The official reserves of the State Bank also depleted by $388 billion to $9.329 billion by week ended July 15, 2022 as compared with $9.717 billion a week ago.

    READ MORE: Rupee hits fresh low Rs224.92 to dollar at interbank closing

    The foreign exchange reserves held by the central bank witnessed a record high at $20.146 billion by week ended August 27, 2021. Since then the official reserves of the SBP declined by $10.817 billion.

    The SBP on July 07, 2022 announced a hike of 125 basis points in policy rate to bring it to 15 per cent. The purpose of increasing the interest rate was to curb the demand and support the rupee value. However, the effort of the SBP failed to support the rupee value.

    READ MORE: Pakistani Rupee crashes to Rs222 against Dollar at closing on July 19, 2022

  • Super tax to apply for Tax Year 2022 and onwards: FBR

    Super tax to apply for Tax Year 2022 and onwards: FBR

    ISLAMABAD: The Federal Board of Revenue (FBR) on Thursday said that super tax will be applicable for tax year 2022 and onwards.

    The FBR issued Income Tax Circular No. 15 of 2022/2023 to explain important amendments made to Income Tax Ordinance, 2001 through Finance Act, 2022.

    READ MORE: Pakistan enhances income tax rates for banks

    The FBR said that a new section 4C to Income Tax Ordinance, 2001 has been introduced through Finance Act, 2022 and this section will apply for tax year 2022 and onwards.

    Except for the persons whose income as envisaged in this section is below Rs150 million, all other persons including those assessed under Fourth, Fifth and Seventh Schedules to the Ordinance are liable to pay super tax on graduated rates ranging from 1% to 4% based on graduated income slabs provided in Division JIB of Part I of First Schedule given as under:

    READ MORE: Declaring beneficial owner made mandatory for companies, AOPs

    S. No.Income under Section 4CRate of Tax
    1.Where income does not exceed Rs150 million0% of the income
    2.Where income exceeds Rs150 million 1% of the income but does not exceed Rs200 million1% of the income
    3.Where income exceeds Rs200 million 2% of the income but does not exceed Rs250 million2% of the income
    4.Where income exceeds Rs250 million but does not exceed Rs300 million3% of the income
    5.Where income exceeds Rs300 million4% of the income

    However, for tax year 2022 the rate of super tax under this section will be 10% instead of 4%, where the income of the persons engaged, partly or wholly, in business of airlines, automobiles, beverages, cement, chemicals, cigarette & tobacco, fertilizer, iron & steel, LNG terminal, oil marketing, oil refining, petroleum & gas exploration and production, pharmaceuticals, sugar and textiles exceeds Rs.300 million. For tax year 2023, this super tax on income of banking companies will be 10% if the income for the year exceeds Rs. 300 million.

    READ MORE: Pakistan reintroduces capital value tax on motor vehicles

    For the purposes of this section, the income will 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 the Ordinance, excluding amounts specified in (i) above;

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

    (iv) Income computed, other than brought forward depreciation, brought forward amortization and brought forward business losses under Fourth, Fifth and Seventh Schedule.

    READ MORE: Customs duty exemption, concession granted

    Super tax payable under this section will be paid on the date and manner as specified in under section 137(1) of the Ordinance.

    In case of default by the person liable to pay super tax under this section, Commissioner through an order in writing will determine the liability of the person and proceed to recover the same under applicable provisions of the Ordinance, the FBR added.

  • Pakistan enhances income tax rates for banks

    Pakistan enhances income tax rates for banks

    ISLAMABAD: Pakistan has enhanced tax rates for banks through amendments introduced through Finance Act, 2022.

    In this regard the apex tax agency of the country, i.e. Federal Board of Revenue (FBR) on Thursday issued Income Tax Circular No. 15 of 2022/2023 to explain important amendments made to Income Tax Ordinance, 2001 through Finance Act, 2022.

    READ MORE: Declaring beneficial owner made mandatory for companies, AOPs

    The FBR said that tax rates for banking companies are enhanced as explained hereunder:

    The taxable income arising from additional income of banking companies earned from additional investment in Federal Government securities for tax year 2020 and 2021 was taxable at the rate of 37.5 per cent instead of rates provided in Division II of Part I of First Schedule of the Income Tax Ordinance, 2001.

    READ MORE: Pakistan reintroduces capital value tax on motor vehicles

    This provision was further amended through Finance Act, 2021, whereby income attributable to investment in the Federal Government securities of banking companies was made taxable on the basis of advances to deposit ratios at graduated tax rates of 40 per cent, 37.5 per cent and 35 per cent, if ratio was up to 40 per cent, 40-50 per cent and above 50 per cent respectively.

    The Finance Act, 2022 has introduced enhanced rates of tax on taxable income of banks attributable to investment in Federal Government securities.

    READ MORE: Customs duty exemption, concession granted

    The enhanced rates for tax year 2022 are 55 per cent, 49 per cent and 35 per cent if gross advances to deposit ratio was upto 40 per cent, 40-50 per cent or above 50 per cent respectively.

    For tax year 2023, and onwards tax rates will be 55 per cent, 49 per cent and 39 per cent if gross advances to deposit ratio is up to 40 per cent, 40 -50 per cent or above 50 per cent respectively.

    The changes have been incorporated by substituting sub-rule (6A) of rule 6C of Seventh Schedule to the Ordinance.

    READ MORE: Commodities’ illegal movement to be treated as smuggling

    The tax rate on income of banking companies has been enhanced to 39 per cent for tax year 2023 from current 35 per cent through amendment in Division II of Part I of First Schedule of the Ordinance.

    Additionally, the application of section 4B has been restricted up to tax year 2022 in case of banking companies.

  • Declaring beneficial owner made mandatory for companies, AOPs

    Declaring beneficial owner made mandatory for companies, AOPs

    ISLAMABAD: The Federal Board of Revenue (FBR) on Thursday said that declaration of beneficial owner has been made mandatory for companies and Association of Persons (AOPs) under income tax laws.

    (more…)
  • Pakistan stocks slump by 628 points on rupee fall

    Pakistan stocks slump by 628 points on rupee fall

    KARACHI: Pakistan stocks fell by 628 points on Thursday owing to continuous decline in rupee value against the US dollar.

    The benchmark KSE-100 index of Pakistan Stock Exchange (PSX) fell to 39,832 points from last day’s closing of 40,460 points, showing a decline of 628 points.

    READ MORE: Pakistan stocks gain 71 points in range bound trading

    Analysts at Arif Habib Limited said that the benchmark KSE-100 index witnessed a bloodbath session today due to economic and inflationary concerns along with rupee depreciation against US Dollar.

    The rupee made a new historic low at Rs226.81 to the dollar on July 21, 2022 as compared with previous day’s closing of Rs224.92 in the interbank foreign exchange market.

    READ MORE: Pakistan stocks plunge 978 points on rupee devaluation

    They said that the market opened in the positive zone but investors opted for selling which dragged the index to an intraday low of 658 points.

    Volumes continued to remain dull across the board on the contrary decent volumes were observed in the 3rd tier stocks.

    READ MORE: Pakistan stocks plunge 708 points in bloodbath session

    Sectors contributing to the performance include Fertilizer (-100.0 points), Banks (-91.2 points), E&P (-78.8 points), Cement (-60.9 points) and Chemical (-45.4 points).

    Volumes increased from 141.7 million shares to 158.0 million shares (+11.5 per cent DoD). Average traded value decreased by 4.8 per cent to reach US$ 18.9 million as against US$ 19.8 million.

    Stocks that contributed significantly to the volumes are WTL, TPLP, UNITY, CNERGY and PRL.

    READ MORE: Weekly Review: stocks likely to stay positive

  • Rupee hits fresh low Rs224.92 to dollar at interbank closing

    Rupee hits fresh low Rs224.92 to dollar at interbank closing

    KARACHI: The free-fall continued in Pakistan Rupee (PKR) against the dollar on Wednesday as the local currency ended fresh low of Rs224.92 in the interbank foreign exchange market.

    The exchange rate recorded a decline of Rs2.93 to end at Rs224.92 to the dollar from last day’s closing of Rs221.99, the previous historic low of the rupee, in the interbank foreign exchange market.

    READ MORE: Pakistani Rupee crashes to Rs222 against Dollar at closing on July 19, 2022

    Currency experts said that the local unit was under pressure due to political instability.

    Furthermore, the Fitch rating agency has downgraded the Pakistan outlook to negative from positive.

    The experts also believed that the falling foreign exchange reserves also putting pressure on rupee stability.

    The foreign exchange reserves of Pakistan have depleted by $454 million to $15.742 billion by week ended June 30, 2022. The foreign exchange reserves of the country were at $16.196 billion a week ago i.e. June 24, 2022.

    READ MORE: Rupee plummets record low at Rs215.20 to dollar

    The country’s foreign exchange reserves hit all-time high of $27.228 billion on August 27, 2021. Since then the foreign exchange reserves have declined by $11.486 billion.

    The official reserves of the State Bank also recorded a decline of $493 million to $9.816 billion by week ended June 30, 2022 as compared with $10.309 billion a week ago.

    The central bank attributed the decline in foreign exchange reserves to external debt repayments.

    READ MORE: Fitch revises Pakistan’s outlook to negative

    It is pertinent to mention that the SBP received about $2.3 billion from Chinese banks for buildup of foreign exchange reserves. However, despite receiving the amount the external debt payment kept the pressure on the reserves.

    The foreign exchange reserves held by the central bank witnessed a record high at $20.146 billion by week ended August 27, 2021. Since then the official reserves of the SBP declined by $10.33 billion.

    The SBP on July 07, 2022 announced a hike of 125 basis points in policy rate to bring at 15 per cent. The purpose of increasing the interest rate was to curb the demand and support the rupee value. However, the effort of the SBP failed to support the rupee value.

    READ MORE: PKR slips to Rs210.95 against dollar despite IMF agreement

  • Pakistan’s import of CBU motor cars surges by 21% in FY22

    Pakistan’s import of CBU motor cars surges by 21% in FY22

    ISLAMABAD: The import of Completely Built Unit (CBU) motor cars into Pakistan has surged by 21 per cent in fiscal year 2021/2022.

    According to data released by Pakistan Bureau of Statistics (PBS) on Tuesday, the import of CBU motor cars increased to $310.41 million during fiscal year 2021/2022 as compared with $256.2 million in the preceding last fiscal year.

    READ MORE: Prices of KIA Motors raised up to 19.3% amid rupee devaluation

    In terms of rupee, the import of CBU motor cars posted a growth of 34.51 per cent to Rs54.67 billion during fiscal year 2021/2022 as compared with Rs40.65 billion in the preceding fiscal year.

    The overall import of CBU vehicles registered an increase of 59.3 per cent to $616.39 million in the fiscal year under review as compared with $386.95 million in the preceding fiscal year.

    The country imported CBU buses, trucks and other heavy vehicles worth $302 million and CBU motor cycles worth $4.12 million during the fiscal year 2021/2022.

    READ MORE: Rolls-Royce, Hyundai signs pact to lead advanced air mobility market

    On the other hand the import of Completely Knocked Down (CKD) motor cars recorded a massive growth of 52 per cent to $1.7 billion during fiscal year 2021/2022 as compared with $1.12 billion in the preceding fiscal year.

    The overall import of CKD motor vehicles recorded an increase of 54 per cent to $2.44 billion in fiscal year 2021/2022 as compared with $1.58 billion in the preceding fiscal year.

    Analysts believed that the import of CBU and CKD motor vehicles would fall in the current fiscal year due to high interest rates, regulatory measures and significant rise in prices of raw material in the international market.

    READ MORE: Global car manufacturers agree to introduce electric mini-commercial vans

    Analysts believed that amid continuous decline of the local currency against greenback, further price hike in car prices is imminent. “This would be the first time where we have seen the highest frequency (4x) of price increases by the auto industry in a fiscal year,” analysts at Insight Research said.

    The main reasons are higher freight charges, abrupt movement in PKR/USD followed by launch of new model cars with lower localization which further add fuel to the price hike.

    The localization policy started in 1987 and continued till 2004, which required compulsory localization for the automotive industry. However, automobile assemblers are still behind the required level of localization.

    READ MORE: Pakistan car sales surge 54 per cent in FY22

    The major players including Indus Motors, Honda Car and Pak Suzuki have been assembling vehicles since 1992, but localization level of these assemblers are still very low despite their long presence in the market.

    In such situation, it will difficult for new players to achieve high localization as older players are still far behind the required level of localization. Moreover, local auto parts manufactures are sensitive to PKR/USD parity as they are reliant on imported raw materials for production. Thus, making the end product expose to PKR devaluation.

    The analysts said that higher interest rate environment, currency devaluation and auto financing hindrances may pose threat to demand going forward especially in low segment cars under 1000cc.

  • Pakistan’s textile exports hit record high at $19.33 bn in FY22

    Pakistan’s textile exports hit record high at $19.33 bn in FY22

    ISLAMABAD: Pakistan has exported textile products worth $19.33 billion during the fiscal year 2021/2022 making a record high on annual basis.

    The country exported textile products worth $19.33 billion during fiscal year 2021/2022, showing an increase of 25.53 per cent when compared with $15.4 billion in the preceding fiscal year, according to data released by Pakistan Bureau of Statistics (PBS) on Tuesday.

    READ MORE: Textile exports surge to record high $11 billion in 7MFY22

    The textile exports contributed around 61 per cent to the total exports of $31.8 billion during the fiscal year 2021/2022.

    Textile sector plays a significant role in supporting the economy of Pakistan and continue to be in the spotlight owing to country’s dependence on foreign exchange.

    According to analysts at Insight Research, the Pakistani Rupee (PKR) devaluation against the US dollar gave textile exporters a competitive advantage over its competitors in terms of pricing.

    READ MORE: PHMA cries foul on gas suspension to textile industry

    In terms of value, the export of knitwear recorded an increase of 34.23 per cent to $5.12 billion during the fiscal year 2021/2022 as compared with $3.81 billion in the preceding fiscal year.

    The export of readymade garments exhibited an increase of 28.75 per cent to $3.9 billion during fiscal year 2021/2022 when compared with $3.03 billion in the preceding fiscal year.

    Similarly, the export of bed wear recorded an increase of 18.8 per cent to $3.29 billion in the fiscal year 2021/2022 as compared with $2.77 billion in the preceding fiscal year.

    READ MORE: Textile exporters urge allowing cotton import from India

    Meanwhile, foreign buyers purchased Pakistani cotton cloths worth $2.44 billion during the fiscal year under review as compared with $1.92 billion in the preceding fiscal year, showing an increase of 27 per cent.

    The analysts said that some factors are posing threat to the textile industry for the current fiscal year such as i.e., increase in export refinance rate.

    Moreover, cotton shortage remains the key concern for the country as the demand for textile industry grows but cotton production has declined substantially over the last decade, mainly due to fall in cultivation area followed by lower yield resulting from water shortage and inconsistent rainfall.

    In the fiscal year 2021/2022, cotton production stood at 8.3 million bales, which is 2.2 million bales lower than the targeted production.

    However, production has increased by 1.3 million bales compared to last year.

    “Thus, due to the supply and demand gap, textile industry has to rely on imported cotton to meet the country’s demand, putting pressure on country’s import bill,” the analysts added.

    READ MORE: Value added textile exporters demand 50 percent reduction in withholding tax

    The government was eyeing to fetch textile exports of $25 billion for the fiscal year 2022-2023. However, domestic and global challenges are dampening the outlook.

    Possible increase in gas and electricity tariff amid the ongoing energy crises could hamper the local demand. In addition, global economic slowdown due to surging inflation will result in lower apparel demand.

    Moreover, in case of surge in covid-19 cases and imposition of lockdown, textile industry’s operating rate would get effected negatively. Having these challenges in mind, the analysts believe that it would be tough to achieve such growth in textile exports.

  • FBR to invite applications for 502 new posts in Inland Revenue

    FBR to invite applications for 502 new posts in Inland Revenue

    ISLAMABAD: The Federal Board of Revenue (FBR) has created 502 new posts in Inland Revenue filed formation and those will be filled through online applications, according to a notification issued on Tuesday.

    According to the notification the FBR would advertise for filling up 502 posts in BS-1 to 15 in seventeen (17) Inland Revenue field formations of FBR.

    READ MORE: FBR posts Ansari as Member Customs Operations

    As the applicants have to apply online through National Job Portal being maintained by National Information Technology Board (NITB.

    The FBR asked the NITB to complete necessary processes in their system for applying online by the candidates and convey their clearance to FBR, so that the Advertisement could be got published in the press by FBR, at the earliest.

    According to the general instructions the eligible candidates are advised to apply online through National Job Portal Link https://nip.gov.pk. No manual or hard copy of application will be accepted by any office. Candidates applying for more than one post should apply online for each post separately.

    READ MORE: Commodities’ illegal movement to be treated as smuggling

    Vacancies for BS-I to 5 shall ordinarily be filled on local basis in terms of Rule 16 of Civil Servants (Appointment, Promotion & Transfer) Rules, 1973, whereas vacancies for BS-6 to 15 shall be filled by appointment of persons domiciled in the respective province or region of each office strictly under Rule 15 of the aforesaid rules and instructions issued by the Establishment Division from time to time.

    Candidates will be required to bring original documents (Educational, domicile and Experience Certificate etc) alongwith one set of all attested copies of documents at the time of test/interview.

    Screening tests and skills tests (where required) will be conducted as per recruitment policy of the Federal Government. Besides screening test for the post of Sepoy, physical fitness i.e. height and chest of the candidates at the requisite standard, shall also be mandatory.

    READ MORE: Special tax regime for pharma sector introduced

    The contract employees (85-1 to 15), who were appointed under the Family Assistance Package for the families of Government employees, who died while in service, may also apply online for any of the above post, if they desire so, subject to their eligibility.

    10% quota for women, 5% quota for minorities (non-Muslims) and 2% quota for disabled persons shall also be strictly observed by each office as per Government instructions. Disabled persons will have to submit a Certificate as proof of disability, duly issued by recognized Social Welfare Board/office or other authorized Government organization, at the time of test/interview.

    The FBR reserves the right not to fill any vacancy or to reduce the number of vacancies, if the circumstances so warranted at the time of final selection.

    READ MORE: Defacing sales tax invoice declared as offence

    The candidates working in Public Sector Departments/Organizations shall have to submit Departmental Permission Certificates from the respective employers at the time of test/interview, failing which they will not be allowed to participate in test/interview process.

    In addition to 05 years general upper age relaxation by the Government, further upper age relaxation shall be restricted up to the following categories of candidates, as per relevant rules/policy of the Federal Government.

    Minimum and Maximum age shall be calculated on the closing date of receipt of applications.

    Information provided in the online Application Form will be verified. In case of any false or forged information, FBR reserves the right to cancel candidature of any candidate at any stage (even after employment, if so revealed later) and to initiate legal action against the applicant.

    Only short-listed candidates will be called for test/ interview. All the candidates will be allowed to appear in the test/interview on provisional basis, subject to detailed scrutiny of their eligibility as per relevant criteria.

    No TA/ DA will be admissible for the Test/ Interview.

    The candidates may apply online within 15 days from the date of publication of this Advertisement in the press. Applications received after 15 days of publication of Advertisement will not be entertained.