Pkrevenue.com

Author: Mrs. Anjum Shahnawaz

  • Indemnity bond to be made mandatory for international transshipment facility

    Indemnity bond to be made mandatory for international transshipment facility

    ISLAMABAD: Federal Board of Revenue (FBR) on Wednesday issued draft rules to make indemnity bond mandatory for shipping lines intending to use facility of international transshipment cargo within Pakistani sea ports.

    The FBR issued draft rules through SRO 685(I)/2020 to amend Customs Rules, 2001.

    According to the draft rules, shipping lines intending to use the facility of international transshipment would require to furnish an indemnity bond for an amount equal to the approximate value of goods expected to be imported in thirty days as security to ensure exit of goods outside the country within 30 days from the berthing of inward vessel.

    The FBR said that the indemnity bond would be forfeited apart from other consequential penal action under the Customs laws, if the shipping line misuses the facilitation of international transshipment.

    If goods still remain on the port after the expiry date including extended time allowed under the law, the shipping line would be responsible to remove the goods immediately unless the delay was attributed to the port authorities, the FBR added.

    According the draft rules the shipping lines would also liable to submit complete details of Import General Manifest (IGM).

    The shipping lines would require providing details, such as: port of loading; name of transshipment port of Pakistan; port of destination (final port of discharge at foreign destination); bill of lading number; name of foreign exporter; name of foreign importer; weight; seal number; and container number.

  • Exports surge by 25 percent: PBS

    Exports surge by 25 percent: PBS

    ISLAMABAD: The exports of the country increased by 25 percent in July 2020 as compared with the previous month owing to enhance in economic activities after ease in lockdown, according to data released by Pakistan Bureau of Statistics (PBS) on Wednesday.

    The country’s exports were at $2 billion in July 2020 as compared with $1.59 billion in June 2020.

    The rise in exports may be attributed to ease in lockdown and resumption of economic activities during July 2020. The lockdown was imposed since March 2020 to prevent the spread of coronavirus.

    The import bill during July 2020 fell by 2 percent to $3.64 billion as compared with $3.72 billion in June 2020.

    The trade deficit shrank by 22.64 percent to $1.64 billion in July 2020 as compared with deficit of $2.12 billion in June 2020.

    The exports in July 2020 registered an increase of 6.04 percent when compared with $1.88 billion in July 2019.

    The import bill in July 2020 fell by 2 percent when compared with $3.7 billion in July 2019.

    The trade deficit reduced by 10.24 percent in July 2020 when compared with deficit of $1.82 billion in July 2019.

  • Meezan Bank launches electronic e-subscription to IPO

    Meezan Bank launches electronic e-subscription to IPO

    KARACHI: Meezan Bank has successfully launched electronic subscription to IPOs (Initial Public Offerings) for its corporate customers via CDC’s (Central Depository Company) newly launched Master TREC Module in Centralized eIPO System (CES).

    A statement issued on Wednesday said that using Master TREC in CES, Meezan Bank will allow registered Master TREC Holders (Brokerage Houses) to make payments electronically on behalf of their customers through Meezan Internet Banking.

    The newly launched service will also enable Meezan Bank’s corporate customers maintaining an account under CDS Participants (active TREC Holders) to subscribe to IPOs of Shares/Sukuks online on behalf of investors.

    Active TRECHolders, having account in Meezan Bank will now be able to electronically register themselves with CDC through this efficient system, 24 hours a day.

    CDC has introduced this Centralized Master TREC Facilityfor convenient electronic subscription for corporate customers, in accordance with the State Bank of Pakistan (SBP) and Securities and Exchange Commission of Pakistan (SECP) active agenda of digitalization.

    This initiative will provide Brokerage Houses and thus ultimately investors with a hassle-free mechanism for application of subscription to securities.

  • Stock market gains 305 points amid improved activities in cement sector

    Stock market gains 305 points amid improved activities in cement sector

    KARACHI: The stock market gained 305 points on Wednesday amid activities seen in cement scrips following reports of increase in prices.

    The benchmark KSE-100 index of Pakistan Stock Exchange (PSX) closed at 39,882 points as against 35,578 points showing an increase of 305 points.

    Analysts at Arif Habib Limited said that the market opened on a positive note with +73 points and carried the momentum on the back of banking sector, however, selling activity brought the Index down by 152 points erasing the gains posted earlier in the session.

    Market bounced back on the report of increase in cement price / bag, which caused several cement sector stocks to hit upper circuit.

    E&P stocks also took cue from international crude oil prices and closed the session in green. Banking sector on the other hand faced resistance, which kept the pressure on the prices of banking stocks.

    Cement sector led the volumes with 136 million shares, followed by Technology (62. million) and Food (47.5 million). Among scrips, MLCF topped the volumes with 38.5 million shares, followed by POWER (37.5 million) and TRG (34.5 million).

    Sectors contributing to the performance include Cement (+164 points), E&P (+55 points), Technology (+37 points), Textile (+22 points), Fertilizer (-23 points) and Banks (-21 points).

    Volumes dropped from 593.8 million shares to 501.9 million shares (-15 percent DoD). Average traded value also declined by 16 percent to reach US$ 132.5 million as against US$ 157.8 million.

    Stocks that contributed significantly to the volumes include MLCF, POWER, TRG, FFL and HASCOL, which formed 34 percent of total volumes.

    Stocks that contributed positively to the index include LUCK (+49 points), TRG (+37 points), DGKC (+28 points), MLCF (+25 points) and CHCC (+22 points). Stocks that contributed negatively include UBL (-17 points), ENGRO (-16 points), PAKT (-14 points), BAHL (-14 points) and FFC (-13 points).

  • Rupee weakens by 59 paisas against dollar

    Rupee weakens by 59 paisas against dollar

    KARACHI: The Pak Rupee weakened by 59 paisas against dollar for third consecutive day on Wednesday owing to higher demand for import and corporate payments.

    The rupee ended Rs168.23 to the dollar from previous day’s closing of Rs167.64 in interbank foreign exchange market.

    The rupee fell by around Rs1.25 against dollar during last three trading days.

    Currency experts said that due to improved economic activities there was higher demand of the foreign currency for import payments, especially import of raw material.

    In order to curb the prevention of coronavirus the government imposed lockdown across the country in March 2020 and it was gradually eased considering the lower number of reported cases.

    From August 03 the official timing of government offices has been restored to normal working hours.

    The experts said that the rupee likely to rebound in coming days due to improved inflows of export receipts and workers remittances.

  • Business confidence falls on COVID: OICCI survey

    Business confidence falls on COVID: OICCI survey

    KARACHI: Business confidence survey conducted throughout Pakistan during May – June 2020, were largely influenced by the COVID-19 pandemic which has negatively impacted nearly all the businesses, Overseas Investors’ Chamber of Commerce and Industry (OICCI) said in its latest survey released on Wednesday.

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  • FBR updates withholding tax rates on payment to non-residents

    FBR updates withholding tax rates on payment to non-residents

    ISLAMABAD: Federal Board of Revenue (FBR) has updated withholding tax rates on payment made to non-residents for tax year 2021 under Section 152 of Income Tax Ordinance, 2001.

    The FBR updated withholding tax card 2020-2021 (up to June 30, 2020) after incorporating amendments made through Finance Act, 2020.

    According to the withholding tax rates:

    Under Section 152(1), every person shall deduct tax while making payments for royalties and fee for technical payments to non-resident.

    The withholding tax rate shall be 15 percent of the gross amount and it shall be increased by 100 percent in case the person is not on the Active Taxpayers List (ATL).

    Every person paying royalty or fee for technical services to a non-resident shall withholding tax on payment to non-resident person at the time the royalty or fee for technical services is actually paid

    The tax shall be minimum tax as per section 6 read with section 8.

    Under section 152(1A), the tax will be deducted from a non-resident person on the execution of;

    a) Contract or sub-contract under a construction, assembly or installation project in Pakistan including a contract for the supply of supervisory activities relating to such project.

    b) Any other contract for construction or services rendered relating there to.

    c) Contract for advertisement services rendered by TV Satellite Channels.

    The tax rate shall be 7 percent of the gross amount

    The tax shall be collected by every person from non-resident person at the time the amount is actually paid.

    The tax shall be minimum tax on the income of non-resident person arising from a contract.

    Under Section 152(1AA), the tax will be deducted from non-resident on any payment of insurance premium or re-insurance to a non-resident person.

    The tax shall be 5 percent of gross amount and 10 percent for persons not appearing in ATL.

    The tax shall be collected by every person making the payments to non-resident person at the time the amount is actually paid.

    The tax shall be minimum tax.

    Under Section 152 (1AAA) tax will be deducted on payments for advertisement services from non-resident person relaying from outside Pakistan.

    The tax rate shall be 10 percent of the gross amount.

    The tax shall be collected by every person making payment to non-resident at the time the amount is actually paid.

    The tax shall be minimum tax.

    Under Section 152(1C), the tax shall be deducted on remittance outside Pakistan, of fee for off-shore digital services, chargeable to tax u/s 6, to a non-resident person on behalf of any resident or a permanent establishment of a non-resident in Pakistan.

    The tax rate shall be 5 percent of the gross amount.

    The tax shall be collected by banking company or financial institution from non- resident at the time the amount is actually paid.

    Under Section 152(2) tax deduction on payment to non-resident, not otherwise specified.

    The tax rate shall be 20 percent of the gross amount and the rate shall be 40 percent for persons not appearing on the ATL.

    The tax shall be collected by every person making payments to non-resident person at the time the amount is actually paid.

    The withholding tax shall be adjustable.

    Under Section 152(2), as per clause 5AA of Part-II of the Second Schedule, the rate of tax to be deducted under sub-section (2) of section 152, in respect of payments to an individual, on account of profit on debt earned from a debt instrument, whether conventional or shariah compliant, issue by the Federal Government under the Public Debt Act, 1944 and purchased exclusively through a bank account maintained abroad, a non-resident Rupee account repatriable (NRAR) or a foreign currency account maintained with a banking company in Pakistan.

    The tax rate shall be 10 percent  of the gross amount and the tax rate shall be increased by 100 percent in case person is not on the ATL.

    The tax shall be collected by every person responsible for making payment to a non-resident person at the time of payment.

    The tax shall be final.

    Under Section 152(2A), every prescribed person making payment to a Permanent Establishment of Non- Resident.

    For:

    (a) Sale of goods

    (i) In case of a company the tax rate shall be 4 percent of the gross amount.

    (ii) Other than company cases the tax rate shall be 4.5 percent of the gross amount.

    (b) (i) In the cases of transport services, freight forwarding services, air cargo services, courier services, man power outsourcing services, hotel services, security guard services, software development services, IT Services and IT enabled services as defined in clause (133) of Part I of the Second Schedule, tracking services, advertising services (other than by print or electronic media), share registrar services, engineering services, car rental services, building maintenance services, services rendered by Pakistan Stock Exchange Ltd. & Pakistan Mercantile Exchange Ltd., inspection and certification, testing & training services.

    The tax rate shall be 3 percent and the tax rate shall be increased by 100 percent in case persons are not on the ATL.

    (ii) in case of a company the tax rate shall be 8 percent and it shall be 16 percent for persons not on the ATL.

    (iii) Other than company cases the tax rate shall be 10 percent and the rate shall be increased by 100 percent in case persons are not on the ATL.

    (c) Execution of a contract other than a contract for sale of goods or providing/ rendering of services.

    (i) In case of sports persons the tax rate shall be 10 percent and it shall be 20 percent for persons not on the ATL.

    (ii) Other than sports persons the tax rate shall be 7 percent and it shall be 14 percent in case persons are not on the ATL.

    The tax shall be collected by every prescribed person from non-resident at the time amount is paid.

    The tax shall be minimum tax for S.152(2A)(b) and the provisions of sub clauses (i), (ii) and (iii) of clause (b) of sub section (3) and sub-section (4A) of section 153 shall mutatis mutandis apply 152(2B)

    Provided that tax deductible under clause (a) of sub-section (2A) shall not be minimum tax where payments are received for sale of goods by a company being a manufacturer of such goods.

    Section 152A: Payment for Foreign Produced Commercials

    Tax to be deducted from non-resident while making payments for foreign produced commercial for advertisement on any television channel or any other media.

    The tax rate shall be 20 percent of the gross amount and it shall be 40 percent if persons are not on the ATL.

    The tax shall be collected by every person responsible for making payment to a non-resident person at the time of payment. The tax shall be final.

  • SECP recommends allowing individuals to act as securities, futures advisors

    SECP recommends allowing individuals to act as securities, futures advisors

    ISLAMABAD, July 5, 2023 – In a bid to promote the capital market and enhance financial inclusion, the Securities and Exchange Commission of Pakistan (SECP) has recommended allowing individuals to act as securities and futures advisors. This proposal aims to broaden the investor base and expand the outreach of the capital market.

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  • Exports exhibit growth in July after four months decline

    Exports exhibit growth in July after four months decline

    ISLAMABAD: The exports of the country registered growth of 5.8 percent in July 2020, in dollar value terms, as compared to July 2019.

    This growth was recorded after a decline in exports for the last four months, since March 2020, when there was a drop of 8 percent compared to same period last year.

    This declined widened in April 2020, with a drop of 54 percent in exports, which improved but remained at 35 percent in May 2020, improving further to only 6 percent fall in exports in June 2020, as compared to same period last year.

    This was revealed at a meeting chaired by Advisor to the Prime Minister on Commerce and Investment, Abdul Razak Dawood, at Ministry of Commerce on Tuesday, to review the recent trade statistics and devise plans for improving the exports.

    The meeting was attended by senior officers of the Ministry.

    The latest statistics of exports and imports of Pakistan were reviewed in the meeting.

    The strategies for product and geographical diversification were also reviewed in the meeting, in context of the recent trade statistics.

    One of the major sectors which showed good progress is Food Processing sector where a growth of over 300 percent was observed in July 2020.

    Similar growth was witnessed in Made-Upsand Clothing Accessories sectors.

    In addition, Fish and Fish Products sector recorded a healthy growth of 50 percent, while Home Textiles sector, which was declining in the previous months, is now back up with 24 percent growth.

    In terms of exports, a major decline is witnessed in rice and cement, which fell down to 24 percent and 12 percent respectively in July 2020, as compared to same period last year.

    There is also a decline in the export of raw leather and cotton yarn, which is a clear indication that the Government’s policy to pursue value-added exports is showing results.

    On the import side, a decline of 4.2 percent, in dollar value terms, was recorded in July 2020, as compared to July 2019.

    Due to this increase in exports and decline in imports, a 14.7 percent improvement in trade balance is witnessed in July 2020 as compared to July 2019.

    On the geographical diversification, not much progress has been shown in July 2020 as the exports still seem to be heavily dependent on traditional export markets.

    Talking in the meeting, Abdul Razak Dawood appreciated the exporters as well as the government departments for coordinating their efforts in the testing times during the ongoing pandemic.

    He added that this achievement is particularly noteworthy because of the fact that a decline was being observed until the last month and a turnaround of around 12 percentage points has been achieved in just one month.

    Dawood underlined that the Ministry of Commerce will be evaluating its geographical diversification in order to re-align the focus towards new opportunities.

    He also advised the Ministry officers to extend all kind of necessary support to the exporters in order to achieve the targets, not only in terms of numbers but also with regards to intended policy outcomes.

  • Domestic oil sales increase by 3 percent in July

    Domestic oil sales increase by 3 percent in July

    KARACHI: Domestic oil sales in Pakistan posted a three percent year-on-year growth in July 2020, driven by a surge in demand for furnace oil used in power generation and a general revival of economic activity. This growth reflects improved industrial operations and enhanced mobility following the easing of COVID-19 restrictions.

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