Author: Mrs. Anjum Shahnawaz

Investors allowed carry forward capital losses on disposal of securities

ISLAMABAD: Federal Board of Revenue (FBR) on Thursday allowed investors of Pakistan Stock Exchange (PSX) to carry forward capital losses for calculation of capital gain tax.

In this regard the FBR issued SRO 801(I)/2021 to make amendment in the Income Tax Rules, 2002.

The FBR previously issued draft rules through SRO 639(I)/2021 dated June 01, 2021 for seeking feedback from stakeholders.

As per the SRO a substitution in sub-rule (3) of Rule 13D of the Income Tax Rules, 2002 has been made. According to the amendment:

(3) Capital loss arising on disposal of listed securities in tax year 2019 and onwards that has not been set off against the gain of the person from disposal of listed securities chargeable to tax during the tax year shall be carried forward to the following tax year and set off only against the gain of the person from disposal of listed securities chargeable to tax but no such loss shall be carried forward to more than three tax years immediately succeeding the tax year for which the loss was first determined.

In Rule 13N, the substitution in sub-rule (7), as:

(7) Capital loss arising on disposal of listed securities in tax year 2019 and onwards that has not been set off against the gain of the person from disposal of listed securities chargeable to tax during the tax year shall be carried forward to the following tax year and set off only against the gain of the person from disposal of listed securities chargeable to tax but no such loss shall be carried forward to more than three tax years immediately succeeding the tax year for which the loss was first determined.

A new sub-rule after the sub-rule 7 has been inserted, which is:

(7A) Capital loss arising on disposal of listed securities in tax year 2019 and onward shall be carried forward to a subsequent tax year for setting off, in the manner prescribed as follow:

(a) The setting off of eligible capital loss carried forward from previous tax year(s) shall be made by National Clearing Company of Pakistan Limited (NCCPL) under this rule, only in respect of a taxpayer whose name appear or appeared in the Active Taxpayers List (ATL) pertaining to the tax year to which such loss pertains as witnessed by the ATL available on FBR’s website after updation for the tax year to which such loss pertains;

(b) adjustment of carried forward capital loss(es) shall be made on monthly basis by the NCCPL from the first month of updation of ATL for the tax year and on first-in first-out (FIFO) basis;

(c) The NCCPL may requisition date wise position of ATL in respect of particular taxpayer from Information Technology (IT) Wing of the FBR as and when required;

(d) At the end of relevant tax year, NCCPL shall maintain tax year-wise balance of unexpired carried forward capital losses separately identifiable for computation of limitation period for each ta year; and

(e) The manner of adjustment of capital loss carried forward from previous tax years will be in accordance with illustration given in clause (zf) of Rule 13P.

June 24, 2021
Gas supply suspension: NKATI appeals PM to save industry

KARACHI: Faisal Moiz Khan, the President of the North Karachi Association of Trade & Industry (NKATI), has issued a fervent appeal to Prime Minister Imran Khan to intervene and rescue Karachi’s industries from the brink of disaster.
(more…)

June 24, 2021
FBR manipulates budget 2021/2022, proposals not to provide relief to business community: FPCCI

KARACHI: Federation of Pakistan Chambers of Commerce and Industry (FPCCI) has alleged Federal Board of Revenue (FBR) for proposing and manipulating the budget 2021/2022, as the proposals will neither provide relief to business community nor it will help in economic growth.
(more…)

June 24, 2021
KSE-100 index gains 62 points in narrow range trading

KARACHI: The Pakistan Stock Exchange (PSX) witnessed a modest upswing on Thursday, with the benchmark KSE-100 index gaining 62 points in a day marked by narrow range trading.
(more…)

June 24, 2021
KIBOR Rates on June 24, 2021

Karachi – The State Bank of Pakistan (SBP) has unveiled the latest Karachi Interbank Offered Rates (KIBOR) for various tenors on Thursday, shedding light on the prevailing interest rates in the interbank market.
(more…)

June 24, 2021
Mari Petroleum board decides consortium to set up NewCo in Abu Dhabi

KARACHI: The board of directors of Mari Petroleum Company (MPCL) on Thursday decided that a consortium of public limited energy giants shall incorporate a company namely NewCo in Abu Dhabi Global Market or Pakistan.

The company in a notice sent to the Pakistan Stock Exchange (PSX) said that the Board of Directors of MPCL, in its meeting held today i.e. June 24, 2021 has decided that subject to shareholders’ approval, a consortium comprising Mari Petroleum Company Limited (“MPCL”), Pakistan Petroleum Limited, Oil and Gas Development Company Limited, and Government Holding (Private) Limited (collectively referred to as the “Consortium”), shall incorporate a company/special purpose vehicle (a “NewCo”), in Abu Dhabi Global Market or Pakistan, with each Consortium partner having 25% shareholding in the NewCo.

The Consortium has submitted a bid for one of the blocks offered in the Abu Dhabi Bid Round 2019 and incorporation of the NewCo is one of the conditions precedent to qualify for the award: It is hereby clarified that the award shall be granted by the Supreme Council for Finance and Economic Affairs (SCFEA) of the Emirate of Abu Dhabi, and that no decision in this regard has so far been made. In case the block is not awarded to the Consortium, the NewCo shall be dissolved.

Further, subject to the approval of respective shareholders and the Consortium being declared a successful bidder by SCFEA, the incorporation of the NewCo and execution of all definitive agreements, an amount of up to USD 100 million will be invested by MPCL over a period of five years (total investment by all Consortium partners: Up to USD 400 million). Any subsequent funding, if required, will be subject to seeking shareholders’ and relevant approvals.

In addition, subject to approval of their respective shareholders, MPCL (and other members of the Consortium) are required to provide a parent company guarantee for all obligations of the NewCo under the definitive agreements to Abu Dhabi National Oil Company and SCFEA.

June 24, 2021
Rupee makes gain 85 paisas against dollar

KARACHI: The Pak Rupee made a gain of 85 paisas against the dollar on Thursday owing to sufficient supply of export receipts and workers’ remittances.

The rupee ended at Rs157.68 to the dollar from the previous day’s closing of Rs158.53 in the interbank foreign exchange market.

Currency experts said that the market had sufficient supply of the foreign currency that helped the rupee to make gain.

The rupee witnessed a continuous decline against the dollar during this week owing to demand for import and corporate payments.

June 24, 2021

SBP issues customers exchange rates on June 24, 2021

KARACHI: State Bank of Pakistan (SBP) on Thursday issued weighted average customers’ exchange rates for buying and selling of foreign currencies in the rupee.

Following is the table for customers’ exchange rates on June 24, 2021.

CURRENCY	BUYING	SELLING
AED	42.9582	43.0524
AUD	119.4487	119.7089
CAD	128.1527	128.4274
CHF	171.5755	171.9517
CNY	24.3795	24.4299
EUR	188.0948	188.5190
GBP	220.1383	220.6315
JPY	1.4220	1.4252
SAR	42.0473	42.1396
USD	157.6506	158.0139

June 24, 2021

Bitcoin recovers after yesterday’s crash

KARACHI: Bitcoin has recovered on Wednesday after witnessed a decline below $30,000 a day earlier.

The bitcoin on Wednesday bounced back above $34,000 mark to trade as high as $34,367 in early morning trading. It last changed hands at $33,641.27, up 3 per cent on the day, according to CNBC.com

Smaller rivals also surged, with ether rising 6 per cent to $2,014 and XRP up 9 per cent at a price of 64 cents. The reason for the moves higher was not clear, but cryptocurrencies are known for their volatility.

Bitcoin had a solid start to the year, rallying to an all-time high of almost $65,000 ahead of crypto exchange Coinbase’s blockbuster debut and as institutional investors appeared to be warming to it.

But the world’s biggest digital coin has been on a roller-coaster ride since, almost halving in value amid a slew of negative news.

In China, authorities have been clamping down on bitcoin mining, the power-intensive process for validating transactions and generating new bitcoins. Over the weekend, Beijing’s crackdown on crypto mining extended to the hydropower-rich Sichuan province.

June 24, 2021
General Sales Tax on wheat bran taken back: FBR

ISLAMABAD: Federal Board of Revenue (FBR) on Wednesday said that the proposal of 17 percent sales tax on wheat bran has been taken back.

In a statement, the FBR said that in order to boost the present government’s drive to keep inflation under control and to give maximum relief to the business community, General Sales Tax (GST) on wheat bran proposed to be enhanced to 17 percent in the Finance Bill is also being taken back.

The FBR further clarified that the table prescribing tax rates for minimum tax on turnover basis has been substituted in the Finance Bill-2021 to provide relief to retailers of Fast Moving Consumer Goods (FMCG) including flour mills and refineries.

The words, “flour mills” could not be mentioned inadvertently in the table which was an error and had been noted and would be rectified in the amended bill.

This would mean that the minimum tax applicable on flour Mills would remain at 0.25 per cent of the turnover instead of 1.25 per cent as being generally interpreted.

June 24, 2021