Pkrevenue.com

Author: Mrs. Anjum Shahnawaz

  • SBP urged to extend refinance scheme for salary payments

    SBP urged to extend refinance scheme for salary payments

    KARACHI: Federation of Pakistan Chambers of Commerce and Industry (FPCCI) on Saturday urged the central bank to extend the refinance scheme which was introduced for businesses in order to reduce the adverse impact of coronavirus pandemic.

    The FPCCI said that the State Bank of Pakistan (SBP) should extend the refinance scheme by one year for payment of wages and salaries, launched to support employees and prevent layoffs due to the COVID-19 outbreak in Pakistan.

    FPCCI President Mian Nasser Hyatt Maggo appreciated the initiative of SBP; introducing schemes like salary payments, deferred loans, introduction of temporary economic refinance facilities etc. to resolve the cash flow problems of businessmen and industrialists.

    He added that these schemes helped many industrial and service oriented sectors to retain employees during the Corona pandemic period. Under this scheme, SBP has released Rs. 238 billion to the private sector.

    While commenting on the refinance scheme for payment of wages and salaries, the FPCCI chief said that the aim of this scheme is to prevent layoff by financing wages and salaries of employees (permanent, contractual, daily wagers as well as outsourced) for all kind of businesses except for the government entities, public sector enterprises, autonomous bodies and deposit taking financial institutions.

    Since the companies that availed this credit facility through banks have not been recovered from the devastating economic impact of COVID-19, it would be advisable if SBP extend this scheme for more one year.

  • Taxpayers advised to update profile to avoid penalty, exclusion from ATL

    Taxpayers advised to update profile to avoid penalty, exclusion from ATL

    KARACHI: Taxpayers have been advised to update their profile by March 31, 2021 to avoid penalty and exclusion from Active Taxpayers List (ATL).

    Sources in the Federal Board of Revenue (FBR) said that the last date for updating the profile was December 31, 2020. However, this date was extended by the FBR up to March 31, 2021 considering the problems faced by the taxpayers.

    Through the Finance Act, 2020 a Section 114A was inserted to Income Tax Ordinance, 2001 regarding taxpayer’s profile.

    As per the provision, following persons are required to update their profile on IRIS – the official web portal of the FBR:

    a. every person applying for registration under Section 181;

    b. every person deriving income chargeable to tax under the head ‘income from business’;

    c. every person whose income is subject to final taxation;

    d. any non-profit organization as defined in clause (36) of Section 2;

    e. any trust or welfare institution; or

    f. any other person prescribed by the FBR.

    Following details are required for updating the taxpayer’s profile:

    i. bank accounts;

    ii. utility connections;

    iii. business premises, including all manufacturing, storage or retail outlets operated or leased by the taxpayer;

    iv. types of businesses; and

    v. such other information as may be prescribed.

    The FBR issued a detailed explanation on the issue stating that complexity of return forms is an embodiment of the complexity of tax law. “Nevertheless, there is a dire need to simplify return forms without compromising on data required to verify accuracy of the declared version.”

    The FBR said that instead of endeavoring to obtain all the relevant information in the income tax return, a new section has been added wherein taxpayers’ profile may be prescribed in order to capture data relevant to the taxpayer.

    “Person who are already registered before September 30, 2020 and are deriving business income or income subject to final taxation, trust, welfare institutions, non-profit organizations and such other persons prescribed by the board are proposed to file a profile on or before December 31, 2020 (this has been extended up to March 31, 2021).”

    The FBR further said that persons who obtain their registration after September 30, 2020 are proposed to furnish such a profile within 90 days of registration. In case of any change in particulars of information, such persons shall update their profile within 90 days of the change in particulars.

    “The profile contains information relevant to income regarding bank accounts, utility connections, business premises including all manufacturing, storage or retail outlets operated or leased by the taxpayer, types of businesses and such other information as may be prescribed by the board.”

    The FBR said: “If a person fails to furnish or update a taxpayer’s profile within the due date or time period as extended by the FBR under Section 214A of the Ordinance, such person shall not be included in the active taxpayers’ list for the latest tax year ending prior to the aforesaid due date or extended date.”

    However, upon filing or updating the profile, such persons shall be allowed to be placed on the ATL upon payment of surcharge which is proposed to be Rs20,000 in the case of a company, Rs10,000 in the case of an association of persons (AOPs) and Rs1,000 in the case of an individual.

    “Further, a penalty for non-filing or not updating of profile is also proposed at the rate of Rs2,500 for each day of default subject to minimum penalty of Rs10,000,” the FBR added.

  • Weekly Review: market may turn green on expected healthy financial results

    Weekly Review: market may turn green on expected healthy financial results

    KARACHI: The stock market likely turn green after facing five consecutive red sessions owing to expected healthy financial results to be announced during the next week.

    Analysts at Arif Habib Limited said that the market to turn positive in the coming week given healthy earnings expectations in the ongoing result season.

    They also highlighted that the Pak Rupee had appreciated against the USD to PKR 158.82 in the outgoing week.

    The benchmark KSE-100 index of Pakistan Stock Exchange (PSX) is currently trading at a PER of 7.4x (2021) compared to Asia Pac regional average of 17.7x and while offering DY of 6.5 percent versus 2.5 percent offered by the region.

    The market commenced on a negative note as investors resorted to profit taking. Despite finalization of agreement between IPPs and the Government, sentiment in Power sector remained lackluster.

    While as international oil prices crossed USD 60/bbl during mid-week, brief interest was witnessed in the E&P sector.

    Albeit this was short-lived as oil prices corrected slightly by week end, and market participants sidelined from the E&P stocks.

    Pertinently, this week the market witnessed its highest ever single day volume of 1,125 million shares. With that said, the market closed red on all five days, closing at 45,808 points, down by 1,098 points / 2.4 percent WoW.

    Sector-wise negative contributions came from i) Commercial Banks (448 points), ii) Fertilizer (267 points), iii) Oil & Gas Exploration Companies (175 points) and iv) Power Generation & Distribution (113 points). Whereas sectors that contributed positively include i) Cements (318 points), Technology & Communication (16 points) and Refinery (16 points).

    Scrip-wise negative contributors were UBL (105 points), HBL (100 points), and ENGRO (99 points) while positive contributors included LUCK (144 points), DGKC (63 points), and KOHC (36 points).

    Foreign selling continued this week clocking-in at USD 3.2 million compared to a net sell of USD 2.7 million last week. Selling was witnessed in Commercial Banks (USD 4.3 million) and E&P (USD 0.4 million). On the domestic front, major buying was reported by Individuals (USD 12.7 million and Companies (USD 8.4 million).

    Average volumes arrived at 734 million shares (up by 32 percent WoW) while average value traded settled at USD 169 million (down by 1.5 percent WoW).

  • Wholesaler defined under Sales Tax Act

    Wholesaler defined under Sales Tax Act

    Sales Tax Act, 1990 has defined the word ‘wholesaler’ for the purpose of levying tax on supply of goods.

    Sales Tax Act, 1990 – updated up to June 30, 2020 issued by the Federal Board of Revenue (FBR) – explained the word ‘wholesaler’ as:

     “Wholesaler” includes a dealer and means any person who carries on, whether regularly or otherwise, the business of buying and  selling goods by wholesale or of supplying or distributing goods, directly or indirectly, by wholesale for cash or deferred payment or for commission or other valuable consideration or stores such goods belonging to others as an agent for the purpose of sale; and includes a person supplying taxable goods to a person who deducts income tax at source under the Income Tax Ordinance, 2001.

  • SRB starts preparation for provincial budget 2021/2022; invites proposals

    SRB starts preparation for provincial budget 2021/2022; invites proposals

    KARACHI: Sindh Revenue Board (SRB) has started preparation for the provincial budget 2021/2022 and in this regard asked all the association and chambers and other stakeholders to submit their tax proposals by February 15, 2021.

    In a communication sent to all chambers, associations, tax bars, Institute of Chartered Accountants of Pakistan (ICAP), Institute of Cost and Management Accountants of Pakistan (ICMAP) and other stakeholders to submit their proposals in relation to the Sindh Sales Tax on Services Act, 2011 and the rules and notifications issued thereunder.

    The SRB said that it was in the process of formulating budgetary measures for Sindh Budget 2021/2022 in relation to taxation and procedural provisions of Sindh Sales Tax on Services Act, 2011, the Sindh Sales Tax on Services Rules, 2011, the Sindh Sales Tax Special Procedure (Withholding) Rules, 2014, the Sindh Sales Tax Special Procedure (Transportation or carriage of Petroleum Oil through Oil Tankers) Rules, 2018, and the Sindh Sales Tax Special Procedure (Services provided or rendered by cab aggregator and the services provided or rendered by owners or drivers of the motor vehicles using the cab aggregators services) Rules, 2019 and the various notifications issued under the said Act, 2011.

    The SRB further said it has been policy of the provincial revenue board to consult all chambers, associations, groups, stakeholders and taxpayers before finalizing the budget proposals.

    “With this end in view, the SRB requests all persons (including the chambers of commerce and industry, business councils, trade associations, tax bars, Institute of Chartered Accountants, Institute of Cost and Management Accountants, taxpayers, etc.) to send their written proposals in the prescribed format so as to reach latest by Monday, February 15, 2021.

    The SRB provided a format for proposals which included: name of the Act/Rules/Notification proposed to be amended; Section No., Schedule No., Tariff Heading No., Rule No., Para No., involved; existing provisions/rates of tax; proposed provisions/rates of tax; reasons and rationale for the proposal; revenue effect etc.

  • AMCs allowed pension digital account opening

    AMCs allowed pension digital account opening

    In a move towards enhancing accessibility and efficiency in the financial sector, the Securities and Exchange Commission (SECP) of Pakistan has given its approval for Asset Management Companies (AMCs) to open digital pension accounts.

    (more…)
  • Share market sheds 247 points on selling pressure

    Share market sheds 247 points on selling pressure

    KARACHI: The share market fell by 247 points on Friday as selling pressure continued during the day.

    The benchmark KSE-100 index of Pakistan Stock Exchange (PSX) closed at 45,808 points as against previous day’s closing of 46,055 points showing a decline of 247 points.

    Analysts at Arif Habib Limited said that the market saw repeat of selling pressure witnessed yesterday in the second session, which was driven by institutional selling and caused the market closing in red.

    The second session today saw aggressive selling, particularly in E&P, Banks and O&GMCs sector that brought the Index down by -247 points.

    Draw down in international crude oil prices supplemented the decline in E&P sector. Cement sector continued the uptrend with DGKC, LUCK, PIOC moving up and helped adding +303 points during the session.

    Technology stocks also saw profit booking, barring NETSOL that despite declaring nominal EPS and hitting session’s low, bounced back strong.

    Among scrips, WTL topped the volumes with 58.6 million, followed by TELE (37.8 million) and TRG (17.9 million).

    Sectors contributing to the performance include Banks (-114 points), E&P (-109 points), Power (-64 points), Inv Banks (-40 points) and Fertilizer (-16 points).

    Volumes declined from 1.12 bn shares to 442.7 million shares (-61 percent DoD). Average traded value also declined by 41 percent to reach US$ 131.7 million as against US$ 224.1 million.

    Stocks that contributed significantly to the volumes include WTL TELE, TRG, DGKC and PIBTL, which formed 32 percent of total volumes.

    Stocks that contributed positively to the index include LUCK (+58 points), SYS (+23 points), DGKC (+22 points), MTL (+10 points) and PIOC (+6 points). Stocks that contributed negatively include OGDC (-42 points), DAWH (-40 points), HUBC (-37 points), POL (-35 points) and MCB (-30 points).

  • FBR takes all steps to facilitate taxpayers: Chairman

    FBR takes all steps to facilitate taxpayers: Chairman

    ISLAMABAD: Muhammad Javed Ghani, Chairman, Federal Board of Revenue (FBR) on Friday said that the tax authorities are taking all possible steps to facilitate taxpayers.

    As a sequel to E-Kutcheries held on monthly basis to comply with the directions of the Prime Minister of Pakistan, FBR chairman/Secretary Revenue Division, Muhammad Javed Ghani held an E-Kutchery at FBR HQ on Friday to listen to the complaints and issues of taxpayers.

    The complainants interacted directly with the Chairman FBR.

    Chairman FBR listened to the complaints of the taxpayers and issued on spot directions for resolution of complaints.

    Chairman FBR appreciated the suggestions put forth by the taxpayers and assured them that their comments and suggestions would be looked into.

    The chairman assured that FBR was taking all possible steps to facilitate the taxpayers.

    He also requested the taxpayers to visit their nearest RTO and Collectorate for redressal of any problem confronted by them.

    Chairman FBR has already strictly instructed all the field offices to resolve all outstanding issues of taxpayers’.

  • FBR launches first phase of pre-filing in tax returns

    FBR launches first phase of pre-filing in tax returns

    ISLAMABAD: Federal Board of Revenue (FBR) on Friday said it has launched first phase of pre-filling of some information enabled for individual taxpayers in annual income tax returns.

    In a statement regarding ongoing reform process, the FBR said that those efforts were bearing fruit.

    According to the statement, FBR has designed simplified income tax returns for individuals and small & medium enterprises (with turnover less than Rs.10 million).

    Auto-calculation and phase 1 of pre-filling of some information has been enabled for individual taxpayers.

     Phase 1 of automated income tax refunds has been enabled.

    The capability to file appeals through the system has been provided via the e-Appeals module.

    Automation of Sales Tax refunds via FASTER has been further improved.

    Similarly, the processing and payment of export duty drawbacks have also been automated.

    The revenue body said that in line with the vision of the Prime Minister as part of its reforms agenda, FBR has placed a lot of focus on facilitation of taxpayers, reducing human interaction, simplification of tax statutes and tax filing procedures through automation, integrity management, enforcement of tax code and policy measures to boost revenue and promote exports through increase in business activity, speedy payment of refunds and drawbacks and better service delivery.

    As a result of this reform process, significant improvement has been seen.

    FBR has exceeded the seven month revenue target for FY 2020 – 2021 by collecting Rs. 2,570 billion against the target of Rs. 2,550 billion.

    This target has been achieved despite the issuance of 80 percent more refunds in comparison with same period last FY (Rs.129 billion against 69 billion for last year). This has helped the business community in reducing cost of doing business and providing working capital for investment.

    A dedicated portal has been created to manage taxpayer complaints and to provide feedback. Large Taxpayers Office (LTO) has been opened in Multan to facilitate large taxpayers.

    Moreover, taxpayer registration for Sales Tax purposes has been enabled on the system (ICT based Sales Tax survey). Simultaneously, on the Customs side, an online import duty calculator has been enabled on WeBOC for the importers / customs agents in order to find the duty / taxes without filing of Goods Declaration.

    The Authorized Economic Operator (AEO) Program has been launched for trusted trade partners. This is also part of the Trade Facilitation Agreement (TFA) under WTO.

    A dedicated portal (Maloomat TaxRay) has been launched for taxpayers to view what information FBR holds about them. Moreover, the systems used for Prosecution, Appellate, and Alternate Dispute Resolution systems have been strengthened, revitalized, and automated.

    Additionally, on the Customs side, the Anti-Smuggling and Confiscation of goods portal has been enabled for data collection and analysis.

    FBR’s Integrity Management Mechanism has been strengthened. FBR Head Office & field formations have been restructured to improve efficiency.

    Customs Duty concessions and exemptions regime continues to be reviewed and simplified in collaboration with the tax policy board to further improve ease of doing business.

    Another positive development has been seen in the number of duty drawback claims processed via Automated Export Duty Drawback payment system. Since its official launch in end-December (as of 15 January 2021), 74 percent of all claims (55,790 out of 75,345) have been automated whilst 71 percent of amount has been remitted.

  • Rupee appreciation journey continues for 6 consecutive trading days

    Rupee appreciation journey continues for 6 consecutive trading days

    KARACHI: The Pak Rupee appreciated for six consecutive trading days against the dollar on Friday owing to improved inflows of export receipts and workers’ remittances.

    The rupee gained 25 paisas to end at Rs158.82 to the dollar from previous day’s closing of Rs159.07 in the interbank foreign exchange market.

    The appreciation in the rupee value has been continued for the last six consecutive days. The rupee gained around Rs1.36 against the dollar after closing at Rs160.18 on February 03, 2021.

    Currency experts said that improved inflows of export receipts and workers’ remittances helped the rupee to make gain against the foreign currency.

    Pakistan’s exports have crossed over $2 billion for the fourth consecutive months in January 2021 for the first time in last eight years, a official statement said.