KARACHI: State Bank of Pakistan (SBP) on Monday issued following Karachi Interbank Offered Rates (KIBOR) as on June 21, 2021.
| Tenor | BID | OFFER |
| 1 – Week | 6.92 | 7.42 |
| 2 – Week | 6.96 | 7.46 |
| 1 – Month | 7.01 | 7.51 |
| 3 – Month | 7.20 | 7.45 |
| 6 – Month | 7.44 | 7.69 |
| 9 – Month | 7.52 | 8.02 |
| 1 – Year | 7.58 | 8.08 |
In Karachi, the Pakistani Rupee witnessed a depreciation of 62 paisas against the US Dollar on Monday, primarily attributed to heightened demand for imports and corporate payments.
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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.
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 income | Rate of tax |
| (1) | (2) | (3) |
| 1. | Where taxable income does not exceed Rs. 400,000 | 0% |
| 2. | Where the taxable income exceeds Rs. 400,000 but does not exceed Rs. 600,000 | 5% of the amount exceeding Rs. 400,000 |
| 3. | Where taxable income exceeds Rs. 600,000 but does not exceed Rs. 1,200,000 | Rs. 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. 2,400,000 | Rs. 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. 3,000,000 | Rs. 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. 4,000,000 | Rs. 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. 6,000,000 | Rs. 620,000 plus 30% of the amount exceeding Rs. 4,000,000 |
| 8. | Where taxable income exceeds Rs. 6,000,000 | Rs. 1,220,000 plus 35% of the amount exceeding Rs. 6,000,000 |
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.
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
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.
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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.
KARACHI: The stock market is likely to regain positive momentum next week on the expected exit of Pakistan from the grey list of Financial Action Task Force (FATF).
Analysts at Arif Habib Limited said that the market to regain positive momentum in the coming week. With FATF’s Plenary Session to be held on 21st June 2021, the index is expected to bounce back as an exit from the grey list seems imminent.
Furthermore, on COVID-19 front, infection ratio has dropped to 1.91 percent (which is an 8 month low).
The benchmark KSE-100 index of Pakistan Stock Exchange (PSX) is currently trading at a PER of 6.9x (2021) compared to Asia Pac regional average of 16.5x while offering a dividend yield of ~6.8 percent versus ~2.6 percent offered by the region.
The market commenced on a positive note this week given a set of relief measures announced in the Budget such as a decline in capital gain tax to 12.5 percent from 15 percent tagged with positive measures for refineries, auto sector and information technology sector.
Moreover, the government increased dividend expectations from OGDC and PPL (Rs17.50/share and Rs8.25/share, respectively) which kept these scrips in the limelight.
However, the market turned red later in the week as the investors resorted to profit-taking. Furthermore, a deadlock between the IMF and the government persisted which further stressed sentiment. Albeit, the market settled at 48,239 points, shedding 66 points (down by 0.14 percent) WoW.
Sector-wise negative contributions came from i) Commercial Banks (176 points) ii) Fertilizer (88 points), iii) Food & Personal Care Products (52 points), iv) Automobile Assembler (34 points) and v) Miscellaneous (31 points). Whereas, the sectors that contributed positively include Oil & Gas Exploration Companies (156 points), Cement (74 points), Power Generation & Distribution (31 points), Engineering (30 points) and Tobacco (25 points). Scrip-wise negative contributors were HBL (88 points), UNITY (56 points), TRG (47 points), UBL (40 points) and EFERT (34 points). Scrip-wise positive contributors were OGDC (99 points), POL (64 points), HUBC (46 points), LUCK (36 points) and SYS (28 points).
Foreign selling continued this week clocking-in at USD 6.8 million compared to a net buy of USD 7.5 million last week. Selling was witnessed in Commercial Banks (USD 2.5 million) and Technology (USD 2.5 million). On the domestic front, major buying was reported by Individuals (USD 21.4 million and Mutual Funds (USD 10.9 million). Average volumes arrived at 1,049 million shares (down by 3 percent WoW) while average value traded settled at USD 170 million (up by 6 percent WoW).
KARACHI: The Executive Board of the World Bank has approved a financing of $442 million to support Pakistan in improving access to water and sanitation services for the vulnerable rural communities in Punjab province, a statement on Saturday.
It said that the Punjab Rural Sustainable Water Supply and Sanitation Project (PRSWSSP) will help upgrade water supply and sanitation infrastructure and services that ensure equitable and sustainable access to drinking water and safe wastewater management. The project prioritizes rural settlements, where water contamination and poor sanitation practices are more prevalent, causing high levels of illness and child stunting.
“PRSWSSP will help more than six million rural residents in the poorest districts of Punjab to reduce child stunting and address areas at high risk to droughts and water scarcity,” said Najy Benhassine, World Bank Country Director for Pakistan.
“The World Bank is committed to the government in improving sustainable water resource management. This project will support investments that increase climate resilience, including flood protection, rainwater harvesting and water conservation in these districts.”
The project will implement tailored, cost-effective solutions for both large and small rural settlements, using scalable technologies that help facilitate solid and animal waste management at the household and community levels. It will also establish a water-quality monitoring system to ensure compliance with national standards for drinking water and wastewater.
The PRSWSSP will promote safe water handling, hygiene, and water conservation practices at the household level, with a focus on maternal, newborn and child health.
“The project is expected to yield substantial benefits to rural communities. It will help improve health outcomes by reducing water borne illnesses and ensure service quality and customer care through a financially sustainable public company,” said Farhan Sami, Task Team Leader for the project.
The project will cover 16 districts, with 50 percent of districts drawn from south Punjab, and 25 percent each from central and north Punjab, benefiting 2,000 villages and more than six million people in rural areas. It will also provide training of village councils and community caretakers, which will have complementary responsibilities for operations and maintenance, monitoring and evaluation, and customer service.
“Child stunting is endemic and a huge constraint on Pakistan’s potential,” said Ghazala Mansuri, co-Task Team Leader for the project. “It impacts a child’s cognitive development and immune system, reducing educational attainment, making illness more likely, and leading to lower productivity and income. Its effects are inter-generational, transmitted from parent to child. This project would provide the template for a transformational shift in human capital accumulation since it addresses all the determinants of stunting.”
The project design was informed by a 2018 flagship report, When Water Becomes a Hazard: A Diagnostic Report on The State of Water Supply, Sanitation and Poverty in Pakistan and Its Impact on Child Stunting, that examined linkages in Pakistan between water and sanitation services, and child stunting.
This study also supported environmental sustainability and the need to provide information and support behavioral change in poor rural communities to reduce health risks.
Pakistan has been a member of the World Bank since 1950. Since then, the World Bank has provided $40 billion in assistance. The World Bank’s program in Pakistan is governed by the Country Partnership Strategy for FY2015-2020 with four priority areas of engagement: energy, private sector development, inclusion, and service delivery. The current portfolio has 57 projects and a total commitment of $13 billion.