KARACHI: Federation of Pakistan Chambers of Commerce and Industry (FPCCI) on Saturday demanded the government of reducing levy and taxes on petroleum products to support the trade and industry.
(more…)Author: Mrs. Anjum Shahnawaz
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Commissioners IR given power to select taxpayers for audit
ISLAMABAD: Federal Board of Revenue (FBR) has decided to authorize Commissioner Inland Revenue to select cases for audit under relevant provisions of tax laws.
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Weekly Review: rising cases of coronavirus remain challenge for trading
KARACHI: The stock market trading likely range bound during next week on the back of concerns over rising number of cases and probable government measures to contain it.
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FBR notifies promotions of IRS, PCS officers to BS-22
ISLAMABAD: Federal Board of Revenue (FBR) has notified promotions to BS-22 of officers of Inland Revenue Service (IRS) and Pakistan Customs Service (PCS).
According to a notification issued October 29, 2020, in pursuance of approval of the Competent Authority conveyed vide Establishment Division’s U.O No.7/1/2020-CP-VI, dated 29.10.2020, the following BS-21 officers of IRS are promoted to BS-22 in the same service on regular basis with immediate effect:-
1) Ms. Seema Shakil
2) Nadir Mumtaz Warraich
3) Dr. Muhammad Ali Khan
The FBR said that the officers appearing at Sr .No. 2 and 3 will actualize their promotion from the date they return from deputation and join FBR.
Through another notification, the FBR said in pursuance of approval of the Competent Authority conveyed vide Establishment Division’s U.O.No.7/1/2020-CP-VI dated 29.10.2020, the following BS-21 officers of PCS are promoted to BS-22 in the same service with immediate effect and until further orders:-
(i) Abdul Rashid Sheikh
(ii) Muhammad Saleem Ahmad Ranjha
The FBR said that if the officers are drawing Performance Allowance prior to issuance of these notifications, they will continue to draw this allowance on their promotion.
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Motor vehicle tax rates for Tax Year 2021
ISLAMABAD: Federal Board of Revenue (FBR) has updated rate of income tax on motor vehicles used for passenger and goods transportation. The income tax rate shall apply during tax year 2021 (July 01, 2020 to June 30, 2021).
The FBR issued Income Tax Ordinance, 2001 (Updated up to June 30, 2020) after incorporating amendments brought through Finance Act, 2020.
The FBR updated rate of income tax on motor vehicles under Section 234 of Income Tax Ordinance, 2001:
Rates of collection of tax under section 234,—
(1) In case of goods transport vehicles, tax of two rupees and fifty paisa per kilogram of the laden weight shall be charged.
(1A) In the case of goods transport vehicles with laden weight of 8120 kilograms or more, advance tax after a period of ten years from the date of first registration of vehicle in Pakistan shall be collected at the rate of twelve hundred rupees per annum;
(2) In the case of passenger transport vehicles plying for hire with registered seating capacity of—
S.No. Capacity Rs per seat per annum (i) Four or more persons but less than ten persons. 50 (ii) Ten or more persons but less than twenty persons. 100 (iii) Twenty persons or more. 300 (3) In case of other private motor vehicles shall be as set out in the following Table, namely:-
S. No. Engine capacity Tax (1) (2) (3) 1. upto 1000cc Rs. 800 2. 1001cc to 1199cc Rs. 1,500 3. 1200cc to 1299cc Rs. 1,750 4. 1300cc to 1499cc Rs. 2,500 5. 1500cc to 1599cc Rs. 3,750 6. 1600cc to 1999cc Rs. 4,500 7. 2000cc & above Rs. 10,000 (4) where the motor vehicle tax is collected in lump sum,
S. No. Engine capacity Tax (1) (2) (3) 1. upto 1000cc Rs. 10,000 2. 1001cc to 1199cc Rs. 18,000 3. 1200cc to 1299cc Rs. 20,000 4. 1300cc to 1499cc Rs. 30,000 5. 1500cc to 1599cc Rs. 45,000 6. 1600cc to 1999cc Rs. 60,000 7. 2000cc & above Rs. 120,000 Following is Section 234 of Income Tax ordinance, 2001
Tax on motor vehicles— (1) Any person at the time of collecting motor vehicle tax shall also collect advance tax at the rates specified in Division III of Part IV of the First Schedule.
(2) If the motor vehicle tax is collected in instalments or lump sum the advance tax may also be collected in instalments or lump sum in like manner.
(2A) In respect of motor cars used for more than ten years in Pakistan, no advance tax shall be collected after a period of ten years.
(3) In respect of a passenger transport vehicle with registered seating capacity of ten or more persons, advance tax shall not be collected after a period of ten years from the first day of July of the year of make of the vehicle.
(4) In respect of a goods transport vehicle with registered laden weight of less than 8120 kilograms, advance tax shall not be collected after a period of ten years from the date of first registration of vehicle in Pakistan.
(5) Advance tax collected under this section shall be adjustable.
(6) For the purpose of sub-sections (1) and (2) “motor vehicle” shall include the vehicles specified in sub-section (7) of section 231B.
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Money printing cost rises to Rs13.32 billion in FY20: SBP
KARACHI: The State Bank of Pakistan (SBP) has said that cost of printing of money increased to Rs13.32 billion in fiscal year 2019/2020.
The central bank in its annual performance report said that the banknote printing charges increased to Rs.13.325 billion in 2019/2020 from Rs.11.419 billion in 2018/2019, thereby registering an increase of 17 percent mainly due to larger volumes of printing and increase in printing rates.
The exchange gains/ (losses) arise on FCY assets and liabilities of the Bank. Major part of the foreign currency assets of the Bank are USD denominated whereas the foreign currency liability exposure is mainly SDR and USD denominated.
Accordingly, the movement in the PKR/SDR and PKR/USD exchange rates directly affects the exchange account.
The bank earned a net exchange gain of Rs.66.402 billion during FY20 as against exchange loss of Rs. 506,131 million during FY19.
The PKR depreciated against USD and SDR during the period however, exchange gain arose due to improvement in net FCY liability exposure as compared to previous year.
Other operating income include penalties levied on banks/financial institutions, licenses and e-CIB fee, gains/(losses) on sale and re-measurement of investments and other income.
The other operating income increased to Rs.8.604 billion in FY20 from Rs.4.347 billion in last year. The increase is primarily attributed to increase in income on penalties levied on banks and financial institutions, licenses fee, e-CIB fee and gain on disposal of foreign investments classified as “fair value through profit or loss”.
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State Bank’s annual profit surges to historic high of Rs1.16 trillion
KARACHI: The State Bank of Pakistan (SBP) has declared profit of Rs1.16 trillion, the highest profit in the history of the bank, for the year ended June 30, 2020.
The SBP in performance report issued on Thursday said that the stability in the exchange rate allowed SBP to return to profitability after incurring loss in the preceding year. The SBP recorded a loss of Rs846 million for the year ended June 30, 2019.
“The profit so earned by the SBP in the year ended June 30, 2020 is highest in its history.”
The high interest rate prevalent in the first three quarters of the year allowed the central bank to accrue significant amount of interest income from the interest sensitive assets, particularly lending to the Government and income from the Bank’s open market operations.
Further, during the year, the liquidity mopping up operations were relatively on reduced scale and hence the interest expense registered a substantial decline.
The total assets stood at Rs.12,273 billion as at June 30, 2020 as compared to Rs.11,467 billion on June 30, 2019, registering an increase of Rs.806 billion primarily due to increase in foreign currency accounts and investments.
Similarly, the total liabilities of the bank stood at Rs.11,219 billion as at June 30, 2020 as compared to Rs.10,761 billion as at June 30, 2019, registering an increase of Rs.458 billion. This rise was primarily led by increase in currency in circulation.
SBP introduced certain interest free/subsidized refinancing schemes during COVID-19 pandemic. As per the requirements of IFRS-9, the subsidized loans are required to be recorded at fair value.
Accordingly, an amount of Rs.4,194 million has been recognized as fair valuation adjustment against these loans. This fair valuation adjustment will be amortized and recorded as income over the period of loans.
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Stock market plunges by 1299 points on increase in corona case
Karachi: The stock market has plunged by 1299 points on Thursday that can be attributed to surge in corona virus cases in the country.
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Mobilink terms FBR recovery action as unfortunate
ISLAMABAD: A spokesman of Jazz (Mobilink) on Thursday said that the treatment of the Federal Board of Revenue (FBR) for the recovery of disputed amount through sealing the office was unfortunate.
“Despite being the largest taxpayers, we are treated in an unfortunate way,” a company spokesman said.
“While the government is making efforts to improve the business environment in the country, such drastic measures would unfortunately severely affect investment prospects,” the spokesman said in a statement.
“We have received a notice from FBR yesterday for the recovery of a disputed tax demand and we have serious reservations on these alleged taxes.
“The proceedings were carried out on plea of a tax recovery notice for a disputed amount from 2018 which is under legal proceedings.
“Due to the drastic measures our corporate reputation and pride has been hurt and shakes the confidence of foreign investors of Jazz and others.
“Despite being the largest taxpayers, we are treated in an unfortunate way.
“While the government is making efforts to improve the business environment in the country, such drastic measures would unfortunately severely affect investment prospects,” the spokesman said.
Jazz seeks resolution of the matter and has always been willing to conduct dialogue as well as rightful legal course to reach merit and right interpretation.
“Jazz also assures its valued customers that despite the challenges, we will continue to provide uninterrupted services,” the statement said.
Mobilink is Pakistan’s number one 4G operator and the largest internet and broadband service provider is amongst the largest taxpayers and the biggest foreign investors with an investment of over US$ 9.5 billion during the last 25 years.
In the last 6 years alone, Jazz has contributed over Rs251 billion to the national exchequer in the form of taxes and duties.
Jazz has always been a law-abiding corporate citizen and has been in the forefront for contributing to Pakistan’s economy in monetary and development terms, and as the market leader in telecom and internet services with over 63 million customers.
The company has also discharged its social responsibility in floods, earthquakes, and recently in COVID-19 relief response worth over Rs1.2 billion.
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OICCI expresses dismay over FBR action against mobile operator
KARACHI: Overseas Investors Chamber of Commerce and Industry (OICCI) on Thursday expressed its shock and dismay over action taken by the tax authorities against Pakistan’s leading mobile operator.
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